Reece Committee Hearings - Tax-Exempt Foundations (1953) - Part 3 of 4

TAX-EXEMPT FOUNDATIONS 1077
strength and in moral and intellectual capacity on the basis of free

and responsible research and scholarship . We shall continue to sup-
port vigorously this concept which lies at the heart of free institutions
and we will oppose any effort by government to use the tax-exempt
status to accomplish indirectly what could not be done directly under
the Constitution .
D . CONGRESSIONAL JURISDICTION
We respect the heavy responsibility which rests upon the Congress

for carrying out the onerous tasks placed upon it under the Constitu-
tion, but we submit that there are wide areas in the life of our people
which were not intended to be subject to congressional regulation and
control. We have welcomed the statements of the chairman and of
other members of the committee which indicate that this .important
principle is receiving the committee's attention .
However, the committee has heard considerable testimony maintain-
ing that foundations have contributed too much toward an empirical
approach as contrasted with a philosophical approach to certain
studies. We shall speak of this point later ; for the moment, we wish
merely to observe that the relation between empirical studies and fun-
damental or general principle is an intellectual issue which is as old
as man himself, which entered our literature at least as early as Plato
and Aristotle, and which will endure as long as there are men to think .
It is not a question which any foundation, or all the foundations,
can or should referee or decide, and our foundations have never
attempted to do so . Nor is it, we submit, a matter under the jurisdic-
tion of the Congress.
Similarly, the curriculums of our schools are in the hands of tens of
thousands of agencies which are independent in curriculum matters ;
these are the State and local educational authorities, teachers in our
schools and colleges, and the boards of our independent educational
institutions of alll levels . The great strength of our educational sys-
tem is its variety of patterns and its decentralization of control . We
believe that it is not for government, nor for foundations, nor for any
other group, to attempt to impose conformity upon this variety . If
anyone has the impression that the foundations have the power to do
so, he is wrong as a matter of fact . If anyone has the impression
that our particular foundations have exerted pressure to produce such
uniformity, he is equally wrong .
E . PERSPECTIVE AND DISTORTION
The Cox committee reported to the Congress that it had been "allot-
ted insufficient time for the magnitude of its task ." 7 We respectfully
submit that the present committee faces even greater limitations of
time and staff if, even though giving attention to fewer foundations
than did the Cox committee, it extends its inquiry into a half century
of social, economic, and political change in the United States .
The committee has before it a number of reports prepared by its
own staff which purport to deal with these complex events . They
have been widely regarded as a confused and inadequate review of the
decades they purport to cover and are particularly deficient at the
I Final report, p . 6.
1078 TAX-EXEMPT FOUNDATIONS
very point of greatest interest to this committee, namely, the respon-

sibility of the foundations for the events themselves .
We ourselves do not find them to be a competent review of the trends
they discuss, more particularly as to their sweeping generalizations,
their proposed definitions of key terms, the accuracy and relevance of
their charts and tables, and the imbalance of the selected quotations
which they contain . We assume that we are not called upon to per-
suade staff members that they have been wrong about views which
they have now placed in the public record as sworn testimony and that
the committee will adopt procedures which will not permit staff to par-
ticipate in both an accusatory and an adjudicating role .
Although several sections of this statement have a direct bearing
upon these staff reports, we offer here brief comments on three of them .
s
Report o f the director o f research
The committee's director of research described the logic used in the
preparation of his initial report as "reasoning from a total effect to its
primary or secondary causes ." 9 If we read his report fairly in the
context of this investigation, his logic produces the following : (1)
A revolution occurred in the United States in the years 1933-36 ; (2)
this revolution occurred without violence and with the full consent of
an overwhelming majority of the electorate ; (3) this could not have
happened had not education in the United States prepared in advance
to endorse it ; (4) the foundations contributed funds and ideas to edu-
cation ; (5) therefore, the foundations are responsible for the revolu-
tion.
The report in question seems to give little weight to the great de-
pression of the early 1930's, to World War I, and to World War II .
Since the foundations have been charged with some undefined respon-
sibility for an increase in the powers and functions of government,
surely it is relevant that war and depression brought about an in-
creased exercise of power by both the executive and legislative arms
of the National Government under the Constitution . Surely it is
also relevant that, while some measures adopted by Government dur-
ing these decades were abandoned, others have continued, despite
changes in party control, as a part of ongoing public policy . In any
event, a number of allegations heard in the course of these hearings
appear to be directed, not at foundations, but at the executive, legis-
lative, and judicial branches of the Government and at the electorate .
We must strongly protest any attempt to involve our two nonpolitical
organizations in questions which are so basically political, both be-
cause the charges are unsupported and because it would be out of
character for our two philanthropies to attempt to reply to such attacks
in effective political terms .
We must also comment upon the use of the word "revolution" in
the report of the director of research . The word has strong emo-
tional associations . It is frequently used in debate between political
parties and between factions within a political party-and in such
use, it is ordinarily accepted as a forensic figure of speech .
We object, however, to the use of the word "revolution" in an official
proceeding where the implication is a charge of wrongdoing . Such
a figure of speech should not be used as a basis for alleging improper
conduct or for impugning the reputations of respectable and law-
8 Transcript, p . 12 ff., ibid ., p. 5.
0 Transcript, p . 46, ibid., p . 20.


abiding citizens . It does not help to put the word in quotation marks-
these become lost. It does not help to say, at the beginning of the
report, "In no sense should they [i . e ., the statements in the report]
be considered as proof" 10 for such statements are overlooked . It does
not even help that the report came only from a member of the staff,
for it has already been attributed in the press to the committee itself.
As a recent statement of the American tradition on such matters, we
cite the following portion of an address made by President Eisenhower
on 31, 1954, at the Columbia University bicentennial dinner in
New MYork :
Whenever, and for whatever alleged reason, people attempt to crush ideas, to
mask their convictions, to view every neighbor as a possible enemy, to seek
some kind of divining rod by which to test for conformity, a free society is in
danger . Wherever man's right to knowledge and the use thereof is restricted,
man's freedom in the same measure disappears .
Here in America we are descended in blood and in spirit from revolutionaries
and rebels-men and women who dared to dissent from accepted doctrine . As
their heirs, may we never confuse honest dissent with disloyal subversion .
Without exhaustive debate-even heated debate-of ideas and programs, free
government would weaken and wither . But if we allow ourselves to be per-
suaded that every individual-or party-that takes issue with our own convic-
tions is necessarily wicked or treasonous-then indeed we are approaching the
end of freedom's road ."
Report of the Assistant Director of Research on "Economics and the
Public Interest" 12
A further issue of major importance is raised by this report, which
is entitled "Economics and the Public Interest ."
In his introduction, the writer of the report says
This report is made for the purpose of showing the nature and increasing costs
of governmental participation in economic and welfare activities of the Nation .
The body of the report contains a number of tables reflecting the
upward trend of Federal Government expenditures for such purposes
as housing and slum clearance, social security and health, education
(including the GI bill of rights), public works, food programs, etc .
The foundations are brought into the picture by statements in the
preface to the report to the effect that "Most, if not all of these newer
activities of government are recommended in * * * reports by various
educational groups, social science, and others, supported by founda-
tion grants," 11 and that "Much of this planning was done with the
aid of social scientists in government employ * * * [many of whom]
were directly or indirectly connected with educational organizations
who have and still are receiving very substantial aid from the large
foundations." 14
The implication of these statements is that a grant by a foundation
to educational groups or institutions, or for the training of individuals
through fellowships, makes the foundation responsible for the views of
such groups, organizations and individuals on public issues . The re-
port in question seems to assign this responsibility to us even in the
case of employees of Government who are known to work under the
policy direction of the President, Cabinet officers, and the Congress .
10 Transcript, p . 42, ibid., p . 19.
11 The Department of State Bulletin, vol . XXX, No. 781, Publication 5503 (Washington,
D.12C. : U . S. Government Printing Office, June 14, 1954), p . 902 .
Transcript, p . 1407, ibid ., p . 628 .
18 Transcript, p . 1403, Ibid., p . 627 .
14 Transcript, p . 1405, ibid ., p. 627 .
We do not see how such responsibility could possibly be assigned to

foundations, if for no other reason than that it would be wholly con-
trary to public policy to give foundations the power to exercise it .
Nor do we see why funds from foundation sources should be considered
as so different in this respect from funds from all other sources.
Let us assume, however, for the sake of argument, that if the state-
ments in the report were borne out by the facts, the foundations would
be properly chargeable with a share of the responsibility for the in-
creases in governmental expenditure resulting from "these newer
activities of government." Would this be reprehensible "error,"
amounting to misconduct on the part of the foundations? If so, how
much graver must be the responsibility of the Members of Congress
who actually determined the policies and voted the funds in support
of measures which, according to the words of the report, "may be said
to be subversive, un-American, and contrary to public interest ." 15
And how has the Supreme Court of the United States escaped impeach-
ment for sustaining the constitutionality of such measures?
We respectfully urge the committee to reread the report and to com-
pare the views of the Federal Constitution expressed by its author
with those of the Supreme Court as set forth by Justice Cardozo (an
appointee of President Hoover) in Helvering v. Davis (301 U . S . 619
(1937) ), upholding the constitutionality of the old-age benefit pro-
visions of the Social Security Act
Congress may spend money in aid of the "general welfare ." Constitution, art.
I . sec. 8 ; United States v . Butler (297 U . S . 1, 65) ; Steward Machine Co . v. Davis,
supra . There have been great statesmen in our history who have stood for other
views . We will not resurrect the contest. It is now settled by decision . United
States v . Butler, supra . The conception of the spending power advocated by Ham-
ilton and strongly reinforced by Story has prevailed over that of Madison, which
has not been lacking in adherents * * * (p. 640) .
* * * Counsel for respondent has recalled to us the virtues of self-reliance and
frugality. There is a possibility, he says, that aid from a paternal government
may sap those sturdy virtues and breed a race of weaklings . If Massachusetts so
believes and chaps her laws in that conviction, must her breed of sons be changed,
he asks, because some other philosophy of government finds favor in the Halls
of Congress? But the answer is not doubtful . One might ask with equal reason
whether the system of protective tariffs is to be set aside at will in one State or
another whenever local policy prefers the rule of laissez faire . The issue is a
closed one . It was fought out long ago . 10 When money is spent to promote the
general welfare, the concept of welfare or the opposite is shaped by Congress,
not the States . So the concept be not arbitrary, the locality must yield * * *
(pp. 644-645) .
10 IV Channing, History of the United States, p
. 404 (South Carolina. Nullification) ; 8
Adams, History of the United States (New England Nullification and the Hartford Con-
vention) .
Our foundations have taken no position either for or against social-
security legislation . We are not quoting the opinion of Justice Car-
dozo as an expression of the views of our foundations on the broad
question of constitutional interpretation which he discusses . Again
our foundations have no corporate opinion on such issues . But we
respectfully submit that on such matters, as on the other controversial
matters covered in the assistant research director's report, where the
legislative, executive, and judicial branches of the Government have
spoken in their support, the measures in question cannot properly be
characterized as "revolutionary," "subversive," or "un-American ."
'- Transcript, p. 1412 . Ibid ., p . 629.


Report by the legal analyst
The policy issues presented by this report, parts I and II, are dis-
cussed in other sections of this statement . This report contains, how-
ever, statistical information about our grants which, on the basis of
our own records and published reports, is so inaccurate as to be
seriously misleading . The following items illustrate these inaccuracies .
Regarding grants by General Education Board to Dec. 31, 1952
According to-
Report of legal GEB records

analyst,' pt. I
Columbia University $7,607,525 a $3, 804,644

College Entrance Examination Board 3,483,000 None
National Education Association 978,312 495,743
Progressive Education Association 4,090,796 1,622,506
Teachers College 11, 576, 012 1,540,397
Lincoln School 6,821,104 5,966,138
University of Chicago 118, 225,000 25,090,562
' Transcript, p . 1568 . Ibid ., p . 701.

2 Includes amount to Teachers College shown below .
Regarding grants by the Rockefeller Foundation, 1929-52

According to=-
Report of legal RF records

analyst,' pt . I
American Council on Education $1,235,600 $397,400

Columbia University 33,300,000 25,113,248
London School of Economics 4,105, 592 938,397
Teachers College 1,750,893 644,271
University of Chicago a 25, 087, 000 13,170,103
I Transcript, p . 1574. Ibid ., p . 703 .

s Includes amount to Teachers College shown below .
I The legal analyst's report added to this figure a personal gift of $35 million by John D . Rockefeller, Sr.,
which resulted in a total figure of $60,087,000 . The personal gift has been eliminated in this comparative
statement, which, is limited, to the foundation's contributions .
Regarding further grants by the Rockefeller Foundation
According to-
Report of Rockefeller
legal ana- Foundation
list,' pt . II records
American Council of Learned Societies (19Z15-52) ----------------------------- $11,069,770 $4,758,775

American Historical Association (1925-37) 190,830 43,001
Institute of International Education (1928-52) 1,406,405 561,505
I Report, pt. 11, p. 51 . Ibid., p. 294 .

If we are furnished information as to the figures desired, we shall
be glad to supply them in the interest of an accurate permanent record .
F . SCOPE OF THE PRESENT INVESTIGATION
At the first public hearing, the chairman of this committee included

the following in his remarks about the scope of the present inquiry
Moreover, and again with an occasional exception, we shall chiefly confine
our attention to the work of foundations in what are called the social sciences .
Little criticism has come to us concerning research or other foundation activities

in the physical or exact sciences, such as medicine and physics ."
If we shall not spend much time in exposition of what great amount of good
the foundations have admittedly done, it is because we deem it our principal
duty fairly to seek out our error . It is only through this process that good can
come out of our work . It will be for Congress, the people, and the foundations
theselves to judge the seriousness of such error, and to judge also what corrective
means, if any, should be taken . Our intention has been, and I wish to make
this doubly clear, to conduct an investigation which may have constructive
results, and which may make foundations even more useful institutions than
they have been ."
We appreciate the fact that the chairman has taken note of large
fields of foundation activity which have, over the years, become largely
noncontroversial in character . With full confidence in the import-
ance and usefulness of our support for work in the social sciences, we
urge the committee to take all of our activities into account in any
evaluation of our two foundations . In the case of the Rockefeller
Foundation, for example, it grants in the social sciences represent 15
cents of the foundation's dollar expended . We believe that these ap-
propriations have rendered a notable public service. But the broader
question of the benefit to the public of any particular foundation
necessarily involves a view of its work seen as a whole .
The committee has had little attention drawn to the wide-ranging
scope of the private philanthropy provided by our two foundations .
It would be impossible for us to summarize this activity in the space
reasonably available to us . We respectfully urge any committee mem-
bers who have not had an opportunity to do so to read Raymond B .
Fosdick's book, a copy of which we are furnishing each member of
the committee, our replies to the Cox committee questionnaire, and
our testimony before that committee .
We append two tables 18 which we believe will be of some assistance.
The first is a summary table covering both organizations, which was
furnished to the Cox committee, but now is brought up to date through
1953 . The second is a breakdown of grants of the Rockefeller Founda-
tion to show something of the larger purposes for which they were
made.
Mindful of the chairman's desire to concentrate : (a) on the social
sciences, and (b) on seeking out error, we are naturally interested in
the standard by which error is to be identified . If knowledge is much
more elusive in the study of human affairs than in the case of physical
phenomena, just so is it more difficult to be certain about what con-
stitutes error.
Any scholar or scientist is subject to temporary errors ; under con-
ditions of freedom, corrections are worked out in the process of scien-
tific and scholarly debate, oral or written, and the issues resolved by
further testing and experimentation . It is not impossible for such
issues to remain unresolved indefinitely, where no existing hypothesis
appears adequately to explain all the data which must somehow be
taken into account . Such differences are not treated as charges and
countercharges but are the bricks out of which the edifice of knowl-
edge is gradually built .
16 Transcript, p . 3, ibid ., p . 2 .
18 Appendixes A and. B .

If, however, we classify as error any departure from a generally

accepted principle of dogma, or any view which opposes one's own,
or any questioning of one s own commonsense experience, or any view
which conflicts with one's own interest, then an official search for error
must evoke the gravest misgiving . We have supposed that our con-
stitutional arrangements and public policies make room for the widest
divergence of ideas, while exacting a course of conduct from each of
us which shares equitably the privileges and responsibilities of free-
dom.
We do not feel it necessary to consider at length the full implica-
tions of the above comments, because we believe that there are other
questions which would be more immediately helpful to the committee,
in judging the role of our foundations in the social-science field . These
questions are-
(1) Is it a reasonable exercise of the discretion vested in the
trustees of the Rockefeller Foundation to appropriate funds in
support of social studies as a contribution to the well-being of
mankind?
(2) Is it a reasonable exercise of such discretion for the trustees
to make such grants almost exclusively to colleges, universities,
and other research and scholarly organizations?
(3) Is it a reasonable exercise of such discretion to make such
grants to such institutions, without requiring that the resultin
studies conform to predetermined views of the foundation itself .
(4) Does the totality of grants made in support of the social
sciences by the Rockefeller Foundation represent a body of re-
search and investigation which is consonant with the public
interest of the United States and with the well-being of mankind?
We believe that all four questions must be answered affirmatively .
III . ORGANIZATION AND PROCEDURES
A . ORGANIZATION AND PURPOSES
The Rockefeller Foundation was chartered by a special act of the

Legislature of the State of New York in 1913 for the purpose of pro-
moting the well-being of mankind throughout the world . In 1929
.the Laura Spelman Rockefeller Memorial, another philanthropic
foundation established in 1918 by Mr . Rockefeller, was consolidated
with the Rockefeller Foundation . The total of Mr . Rockefeller's
gifts to the foundation was $182,851,000, and the assets of the memorial
at the time of consolidation had a value of $58,756,000 . By the end of
1953, the foundation had made 30,572 grants, totaling $501,749,878 in
expended and authorized appropriations . Its remaining capital funds
have a present market value of approximately $366 mililon 19
The General Education Board was incorporated in 1903 by a special
act of Congress for the purpose of promoting education in the United
States of America, without distinction of race, sex, or creed . It
received from Mr . Rockefeller $129,209,117 in a series of grants and
an additional $15,751,625 from the Rockefeller Foundation, making
a total of $144,960,742 . 20 The board has made 11,237 grants totaling
$317,733,124, for the benefit of education in this country . Its funds
20' An additional $116,615 was received in gifts from other sources .

As of July 21, 1954.
have now been distributed or allocated except for a relatively small

balance of about $700,000 21 and, for this reason, it is in the process of
winding up its activities .
Although they are legally independent of one another, the Rocke-
feller Foundation and the General Education Board have had close
ties. For many years a substantial majority of both boards of trustees
.has been identical . Since 1936 they have had the same chairman
(successively John D . Rockefeller, Jr ., Walter W . Stewart, John
Foster Dulles, and John D . Rockefeller 3d) and the same president
(successively Raymond B . Fosdick, Chester I . Barnard, and Dean
Rusk) . For a much longer period they have had a common treasurer ;
they are both served by the same comptroller . They have occupied
offices on adjoining floors of the same building, which has fostered
close contacts between the two staffs .
The operations of each organization have been in a broad sense
coordinated with those of the other . Thus the foundation, authorized
finder its charter to promote the well-being of mankind throughout
the world, has tended to defer to the General Education Board on
opportunities for aid to education as such within the United States,
the field to which the board is directed by its charter . Of course, the
Rockefeller Foundation has made substantial sums available to edu-
cational institutions in the United States and other countries in
connection with its own activities .
B . TRUSTEE RESPONSIBILITY
The allegation has again been made before this committee that the
trustees of foundations abdicate their responsibility . The Cox com-
mittee inquired into this point in 1952 hearing considerable testimony
upon it, and reached a finding favorable to foundation trustees which
concluded with the following statement
As to the delegation by trustees of their duties and responsibilities, the prob-
lem is basically the same one that confronts the directors of a business corpora-
tion. Both must rely in large measure upon their staffs . There is this one
important difference, in the opinion of the committee . The trustees of a public
trust carry a heavier burden of responsibility than the directors of a business
corporation . In fairness it should be said that in the opinion of the committee
this principle is fully recognized by the trustees of foundations and that they
make a determined effort to meet the challenge!'
It is difficult to understand the allegation in the case of the General
Education Board prior to the recent curtailment of its activities, or its
survival in the case of the Rockefeller Foundation, where the facts
conclusively refute it. The explanation may lie in the quandary in
which a hostile critic finds himself when he wishes to attack a grant
which has been made by a board of trustees of distinguished citizens
whose broad experience, public service, and loyalty cannot be effec-
tively questioned . He elects to retreat into the position that "These
men obviously didn't do it," rather than face the fact that such men
might disagree with him .
The trustees of the Rockefeller Foundation, a complete list of whom
is attached '23 fully recognize a heavy responsibility for the trust which
has been placed in their hands . They meet it in the following manner
n As of July 21, 1954 .
21 Final report, p. 11.
22
Appendix C.


(A) Board meetings
The full board of trustees meets twice each year, in April (1 full day) and
in December (2 full days) . The 1st day of the December meeting is ordinarily
given over to a general discussion of the policies and procedures of the'founda-
tion ; it is here that the trustees are afforded an opportunity to raise new ideas
and offer criticisms and suggestions about the work of the foundation in its
broadest aspects. As for the appropriations of funds to be considered at the 2
full meetings, the trustees are provided a docket at least 10 days in advance,
which contains a description of the activities for which funds are recommended
by the officers . The distribution of such a docket prior to each meeting gives
the trustees an opportunity to study proposed actions in advance and to be
prepared to offer suggestions or raise questions or consult with others before
final action is taken . At each meeting, proposed appropriations are presented
orally by the officers and are subject to discussion, approval, modification, or
rejection by the full board . This consideration is not merely formal in character
but includes the type of exchange which develops a consensus in the board and
between the board and the officers which gives direction and guidance to the
work of the foundation.
(B) Executive committee
The executive committee of the board of trustees has seven regular and two
alternate members under the chairmanship of the president . It meets at least
six times a year at the offices of the foundation . It receives an advance docket
and considers proposed appropriations with the same procedures used by the
full board. It is limited in the amounts it may expend between board meetings
without the express authorization of the board .
(C) Special policy committees
From time to time the chairman of the board of trustees may appoint a special
policy committee of the trustees to review the policies and operations of the
foundation. Such reviews extend over a period of months and require sub-
stantial commitment of time and interest from the trustee members of such
committees. Their conclusions and recommendations are reported to the full
board where thorough discussion serves to clarify policy and to readjust the
work of the foundation to changing conditions .
(D) Other trustee committees
Other standing committees of the board are the finance committee, the nom-
inating committee and the committee on audit, whose functions are indicated by
their titles.
(E) informal discussion
The trustees take a lively interest in the work of the foundation which leads
to a considerable amount of informal discussion among themselves, between
trustees and officers, and between trustees and individuals outside the founda-
tion.
(F) Publications
The trustees receive and read the publications of the foundation, including a
monthly confidential report prepared by the officers for the information of the
trustees . The latter report is "confidential" largely because it is intended only
for use within the foundation itself and because it occasionally discusses the
progress of scientific and scholarly studies before the scientists and scholars
themselves are ready to make their findings public .
(G) Visits to foundation activities
Many of the trustees have an opportunity from time to time to see firsthand
some of the work being supported by foundation appropriations, both in the
United States and abroad . On occasion, 2 or 3 members of the board may be
asked specifically to visit a particular activity, such as the Mexican agri-
cultural program, on behalf of the foundation . Since trustees are men whose
other interests require travel, they frequently avail thmselves of opportunities
to discuss foundation affairs with our representatives stationed abroad and to
visit one or another project.
(H) Election of officers
One of the most important duties resting upon trustees is the election
of the officers of the foundation . This is particularly true in the case of the
president, the two vice presidents, the secretary, the treasurer, the comptroller,
and the directors of the four divisions . With the exception of the president, the
treasurer and the comptroller, the officers are elected annually upon the nomi-
nation of the president . It is fair to say that the procedures of the foundation
give the trustees an excellent opportunity to know and to judge the personalities,
character, and quality of work of the principal officers of the foundation .
It should be obvious from the above summary account that the role
of a trustee of the Rockefeller Foundation is an active one, particu-
larly for those trustees who serve on one or more of its committees .
Despite the demands made upon trustees' time, the attendance of
trustees at board and committee meetings establishes a remarkable
record of attention to duty on a voluntary and unremunerated basis .
Absences are almost invariably limited to those who are ill, out of
the country, or prevented from attending by some other clearly over-
riding consideration . Over the past 5 years, for example, if we ex-
cludes only trustees actually abroad or on formal leave of absence,
attendance at board and executive committee meetings has averaged
86 percent of the membership . This compares most favorably with
the experience of large business corporations .
We conclude these remarks about the role of trustees by repeating
here a portion of the testimony given before the Cox committee by
Chester I . Barnard, former president of the foundation and general
education board
* * * I have been a director of business corporations and still am for 40 years .
I never have seen any board that I have been on-and I know how many of the
others operate-in which the attention to the policies and the details by the
directors or trustees, whichever they use, were such as it is in the Rockefeller
Foundation . I do not know any organization in which a week in advance you
have a complete docket book with the explanation of every item over $10,000
that you are going to be asked to vote on, and that includes with it a detailed
list of every grant-in-aid, of every scholarship or fellowship that has been
granted and any other action taken, and that has attached a list of the declina-
tions . That is just as important from a trustee's point of view as the approvals .
Nor have I ever known of any organization in which so much careful atten-
tion was given to it .
In 12 years I have missed no meetings of the board of trustees of the Rocke-
feller Foundation and only 3 of its executive committee meetings, and that is
not unique at all . That is some record for people who are busy, and every one
of the members on this board is busy . They read the docket book in advance .
In addition to the docket book every single item in most circumstances has to
be presented by the director of the division which proposes it, and he has to
subject himself to cross-examination, and he gets it . He doesn't get it on every
item, of course, but he gets it . So the matters that come before the board of
trustees of this foundation in my experience have been given more careful at-
tention by more competent people than I have seen in any other institution .
There is just nothing like it, and the idea that this thing has been run without
adequate attention by the trustees, that it is just in the hands of a bureaucracy
of officers, just certainly isn't true, and it ought to be recorded here that it
isn't true ."
C . OFFICER AND STAFF RESPONSIBILITY
More has been said about trustees than about the officers and full-
time professional staff, since the role of the latter is better under-
stood. The officers and staff of the Rockefeller Foundation are or-
ganized, broadly speaking, into the divisions of medicine and public
health, natural sciences and agriculture, social sciences, humanities,
and in administration . The full-time personnel of the general edu-
cation board has now been sharply reduced because of the liquidation
of its activities.
as U . S . Congress (82d, 2d sess), House Select Committee To Investigate Foundations
and Comparable Organizations . Hearings (Washington, IT. C. : U . S. Government Printing
Office, 1953, p . 562) .
While, as has been shown, the trustees do not "abdicate" their re-
sponsibilities to the officers of the foundation, they must and do rely
heavily upon the officers for the effective performance of the founda-
tion's tasks . The officers make recommendations on policy, seek the
most promising opportunities for the application of foundation
funds, review and investigate requests, propose grants for trustee
consideration, and keep in touch with educational, scholarly and
scientific leadership in many countries . Some are engaged directly
in scientific research in such fields as virology and agriculture . In
addition to handling the extensive administrative business of the
foundation, the officers are responsible for the approval of small
grants and the award of fellowships under general policies estab-
lished by the trustees and from funds made available by them for
that purpose.
It should be noted that the officers act as a group ; their decisions
and recommendations are not made individually but in a process of
discussion which brings to bear a variety of experience and judg-
ment. The divisions hold frequent staff meetings on requests falling
within their respective fields of interest ; discussions between divi-
sions occur where proposals involve more than one ; finally, proposals
to the trustees are considered in a conference of the principal officers
of the foundation, where criticism and discussion can take place on
the broadest basis .
The bylaws of the Rockefeller Foundation provide that the presi-
dent is the only officer eligible to serve as a trustee . Among the
principal officers of the foundation are always a number who by ex-
perience and capacity would be entirely qualified to serve as trustees
and, were they not officers, might well be invited to join the board .
In fact, then, the affairs of the foundation are in the hands of a board
or trustees of 21 distinguished citizens an officer group of highly
qualified individuals, all of whom can be relied upon to carry the
heavy burdens of their philanthropic trust with care and a deep con-
cern for the public interest .
D . TYPES OF GRANTS
The trustees of the Rockefeller Foundation determine, on recom-
mendation of the officers, what grants are to be made by the Founda-
tion, but the trustees delegate to the officers restricted authority to
make certain smaller grants in categories described below. The trustees
also determine, upon recommendations of the officers, what expendi-
tures are to be made for administration and similar purposes .
The foundation makes grants both to individuals and institutions .
Grants to individuals are in the form of fellowships or of travel grants
and are limited in amount and duration . Grants to institutions are,
in accordance with the policy of the foundation, made only to other
tax-exempt institutions in the United States and to such institutions
abroad as are comparable in character and purpose to those receiv-
ing tax exemption in this country . By following this policy, the foun-
dation is assured that its grants to institutions in the United States
are limited to those which the Government itself has recognized as
being philanthropic in character .
In brief, the foundation's grants are handled as follows
1. The board of trustees, at its meetings, may make grants without
limit in amount, from either income or principal .
49720-54-pt. 2 -10
2. Between meetings of the board, its executive committee, consist-

ing of seven members and two alternate members (all trustees) may
make grants from either income or principal, subject, however, to the
following limitations
(a) Each grant must be in accordance with the general policies
approved by the board ;
(b) No grant may increase by more than $500,000 a grant previ-
ously made by the board ;
c) No new grant may exceed $500,000 ; and
(d) Total grants between meetings of the board may not ex-
ceed $5 million unless authorized by the board .
A summary of the minutes of each meeting of the board and of the
executive committee, listing all grants, is sent to all trustees immedi-
ately following the meeting . All actions of the executive committee
are reported to the board at the first board meeting following such
actions.
3 . The trustees delegate to the officers authority to make certain
smaller grants in the following categories
(a) Grants-in-aid.-These are allocations made by the officers
from funds appropriated for this purpose annually fr each divi-
sion of the foundation by the trustees . Each allocation is limited
to $10,000 ; total allocations to a project may not exceed $10,000
in any one year, and total support of a project through grants in
aid may not extend beyond 3 years or be in excess of $30,000 . The
formal action authorizing the grant in aid must be signed by the
director of the division concerned, by the president or vice presi-
dent, after examining the supporting materials, and by the comp-
troller, who certifies the availability of funds for the purpose .
The usual grant in aid is about $2,000 ; not more than about 7
percent are for as much as $10,000 . All allocations are reported
promptly to the executive committee of the board of trustees .
(b) Director's fund grants.-A director's fund of not more
than $5,000 is set up annually for each division (as an allocation
from the grant-in-aid appropriation made by the trustees) . Indi-
vidual allocations from this fund may not exceed $500 and are
made through a written action signed by a division director and
certified by the comptroller . All such allocations are reported
twice a year to the trustees. The fund provides a flexible mecha-
nism for prompt response to the needs of individual scholars and
scientists at strategic times in the development of their work .
The grants are used for such things as equipment, honoraria,
travel, materials and research assistance .
(c) Fellowship awards .-These are awards made by the offi-
cers from funds appropriated annually for this purpose by the
trustees . The action making the foundation's award is signed by
the director of the division concerned, the president or vice presi-
dent, and the comptroller . All fellowship appointments are re-
ported promptly to the executive committee .
IV . FOUNDATION SUPPORT FOR SOCIAL STUDIES
A . BACKGROUND OF FOUNDATION INTEREST
In a formal sense, the Rockefeller Foundation undertook financial
support for social studies when, in 1929, it was consolidated with the
Laura Spelman Rockefeller Memorial and continued an interest al-
ready developed by the latter philanthropy .
In much broader terms, the foundation came to believe that its com-
mitment to promote "the well-being of mankind throughout the
world" compelled it to give attention to the baffling complexities of
human relations-to the processes by which men earn a living and the
difficulties they encounter in working out tolerable relations among
individuals, groups, and nations.
From the beginning the foundation never considered that it had
or should have solutions to social problems behind which it should
throw its funds and influence . It has had no nostrums to sell. Its
approach rested upon a faith that the moral and rational nature of
man would convert an extrusion of knowledge into an extension of
virtue, and that he could make better decisions if his understanding
could be widened and deepened .
The experiences of World War I and the painful uncertainties of
the postwar and depression period seemed to reflect a growing and
menacing gap between man's technical and scientific capacity and his
apparent inability to deal with his own affairs on a rational basis . In
any event, it did not appear that we could escape fundamental poli-
tical, economic, moral, and social problems by concentrating upon
"safe" scientific subjects . Successes in public health were to mean
rapidly falling death rates and increased population pressures upon
resources. The study of nuclear physics, at first only a brilliant exten-
sion of man's intellectual curiosity, was to lead to hydrogen weapons .
There was no illusion about the rudimentary character of the so-
called social sciences or about the severe limitations which are encoun-
tered in attempting to apply the methods of the physical sciences to
man's own behavior . Nevertheless, it was felt that there might be
.sufficient regularity about human behavior to permit fruitful study,
.and that a scientific approach might evolve methods of study which,
if not a direct application of techniques developed in the older sciences,
-might lead to surer bases of knowledge than we now have . In any
-event, the possibility was worth the effort and the very attempt might
uncover promising leads which would increase our knowledge to a
constructive degree .
A further impulse behind the interest in social studies was a con-
viction that the strengthening of our own free institutions required a
better understanding of the processes of a free society and the frame-
work within which a citizen enjoys the privileges and bears the re-
.sponsibilities of liberty itself . At a period when free institutions
came under challenge from totalitarian ideology of both the left and
the right, it was felt that penetrating studies of our own free economic
. .and political institutions would help them to withstand assault .
It was fully appreciated that social studies would involve contro-
versial subjects. It was felt, however, that a private foundation
could, without itself taking sides on controversial issues, make a con-
tribution by supporting objective studies which might illuminate
such issues and reduce contention .
Three-brief excerpts from our records throw light upon the way in
which the foundation has approached the support of the social
sciences . The first is a memorandum prepared by the executive com-
mittee of the Laura Spelman Rockefeller Memorial in 1924, referred
to by Dr. Thomas Henry Briggs in his testimony before this com-
mittee, 25 the gist of which is quoted in Mr . Fosdick's history of the

foundation
The present memorandum proposes to indicate principles which affect the
ability of the memorial to become associated with projects in the field of social
science . Certain principles would seem to make association undesirable . It
appears advisable :
1 . Not to contribute to organizations whose purposes and activties are cen-
tered largely in the procurement of legislation .
2. Not to attempt directly under the memorial to secure any social, economic,
or political reform .
3 . Not to contribute more than a conservative proportion toward the current
expense of organizations engaged in direct activity for social welfare .
4 . Not to carry on investigations and research directly under the memorial, ex-
cept for the guidance of the memorial .
5 . Not to attempt to influence the findings or conclusions of research and in-
vestigations through the designation of either personnel, specific problems to
be attacked, or methods of inquiry to be adopted ; or through indirect influence
in giving inadequate assurances of continuity of support .
6 . Not to concentrate too narrowly on particular research institutions . incur-
ring thereby the danger of institutional bias .
Certain principles would seem to make assistance from the memorial desirable .
It appears appropriate :
1 . To offer fellowships to students of competence and maturity for study and
reseach under the supervision of responsible educational and scientific insti-
tutions .
2. To contribute to agencies which may advance in indirect ways scientific
activity in the social field .
3. To make possible the publication of scientific investigations sponsored by
responsible institutions or organizations through general appropriations to be
administered in detail by the sponsoring agency .
4 . To contribute toward the expenses of conferences of scientific men for
scientific purposes .
5 . To make possible, under the auspices of scientific institutions, governmental
agencies or voluntary organizations, demonstrations which may serve to test, to
illustrate or to lead to more general adoption of measures of a social, economic
or governmental character which have been devised, studied and recommended
by responsible agencies.
6. To support scientific research on social, economic and governmental ques-
tions when responsible educational or scientific institutions initiate the request,
sponsor the research and assume responsibility for the selection and competence
of the staff and the scientific spirit of the investigations ."
The second quotation is a brief statement on controversy adopted
by the trustees of the Laura Spelman Rockefeller Memorial and sub-
sequently by the trustees of the Rockefeller Foundation, following the
merger in 1929 of the two philanthropies
Subjects of a controversial nature cannot be avoided if the program is to con-
cern itself with the more important aspects of modern social life . In fact, suc-
cessful treatment of issues of a controversial sort would be so important a con-
tribution to the fundamental objectives of the program that the existence of
militant differences of opinion cannot be thought to preclude the promotion of
inquiry under appropriate auspicesS 4
The last is taken from a memorandum prepared by the director of
the division of social sciences of the foundation in 1944
1 . Though the degree of social need is always pressing toward grandiosity,
modest work will, in the long run, be most effective .
2 . In recommending grants officers should try to anticipate the future-never
merely ride the coattails of an already discernible trend .
3. The social sciences division has no "nostrums" to sell . In choosing the ob-
jects of grants the guiding tendency should be not to pronounce answers but to
2s Transcript, p . 271 ff. Ibid ., p . 102 .
2' Raymond B. Fosdick, The Story of the Rockefeller Foundation (New York : Harper
& Bros ., 1952), pp. 200-201 .
E' Ibid ., p . 202 .
discover truth-not to manipulate new forces but to understand them-not to
choose. society's path but to illuminate it 2 8
B. EMPIRICAL STUDIES
It has been suggested to this committee that foundations have had

an adverse effect on scholarship and research through an undue . em-
phasis on empiricism and "a premature effort to reduce our mager
knowledge of social phenomena to the level of applied science ." 29
We have presumed to question whether this committee has a man-
date from the Congress to inquire into the decision of foundation
trustees as to the distribution of funds between empirical and nonem-
pirical studies or to inquire into the current practices of our colleges
and universtities in this regard . But we do not seek to evade the
merits of the issue .
The history of the intellectual processes by which man has accumu-
lated knowledge shows that observation, experimentation, induction,
deduction and verification have each had an important role to play
and that it is by their skillful and imaginative combined use that we
have been able to push back the frontiers of knowledge . Without
empirical examination, general propositions fail to establish and main-
tain contact with reality ; without general concepts, fact-finding be-
comes aimless wandering and produces helter-skelter collections of
unrelated bits and pieces . By observation and experimentation man
refines his ideas about the world in which he lives ; by other rational
processes he reduces his masses of fact and impression to a degree of
order and gives them meaning . After enough regularity has been ex-
posed to justify the construction of a general theory, then and only
then can occur the crucial test of verification . Throughout this process
the questions "What is it?" and "How does it happen?" are among
the tools man uses while seeking an answer to the underlying question,
"What does it mean?" .
The interplay of observation, experimentation and theorizing has
produced brilliant results in the natural sciences, enabling man to
fight back at disease, to harness new forms of power, and to wrest a
more abundant living from his environment . But even in the case
of the natural sciences, the path he has traveled has been a tortuous
one, filled with false leads, imperfect observation, inexact experi-
ment, theories which claimed too much, and contradictory facts -for
which he could find no adequate explanation. New ideas have had
to run a gantlet of prejudice and entrenched opinion . Today's
firmly held truth is modified by tomorrow's fresh discovery. And
still today, as man looks out from peaks of knowledge which he dared
not hope to scale he sees still higher peaks on the distant horizon
and vast fields ofr ignorance still to be explored . The process con-
tinues-with new findings, new mistakes, new instruments, new
techniques, and most important of all, new concepts and fresh
imagination.
It was inevitable that an attempt would be made to apply the
methods of the natural sciences to human affairs . Chemical and
physical approaches to the subtle problems of living matter-once
considered dominated by mysterious "vital forces" had striking and
28
Fosdick, The Story of the Rockefeller Foundation, pp . 211-212.
29
promising successes . It was wholly naturall to attempt to apply sim-

ilar analytical and quantitative techniques to social problems . It
should not be surprising that this attempt would encounter major -
obstacles-as did the efforts of those who first tried to apply Newton's
physics and Lavoisier's chemistry to biology and medicine . The tech-
niques appropriate to the laboratory were insufficient for the study of
man in his social environment ; the circumstances of stud were differ-
ent in fundamental respects ; conditions could not be readily controlled" .
so as to study one factor at a time, as the physical scientist often does .
The basic equipment of the scientist was nevertheless required : care-
ful examination of the evidence, an objective approach to data, and a .
lively and fertile imagination in the construction of hypotheses to be ,
tested, and, throughout, a clear recognition that there must be a joint
emphasis on speculation and experience . Beyond that, technique&
had to be revised and improved ; the danger of seeing too much had"
to be avoided ; and the disconcerting influences of undetected factors
had to be faced. Although his problems of procedure were difficult
enough, the social scientist also faced the resistance and even hos--
tility of man himself, with his personal or group interests affected and'.
his emotions and traditional patterns upset by new knowledge .
The social scientist persists in his effort to learn more about human_
behavior, despite the modest beginnings and the challenging com--
plexity of his task. He believes that he is beginning to know some-
thing, even though he is sure that he does not know everything . He.
is in position to throw some light on some situations, knowing better -
than most where his present limitations are . For example, we know
a great deal more now than we did 20 years ago about the processe&
by which we make a living in a free enterprise economy-more about
capital growth, the labor force, the market, rates of productivity, .
prices ; and this knowledge is becoming more accessible to the tens
and hundreds of thousands whose decisions determine the ebb and .
flow of our economic life. We know more about the consumer, his
plans and prospective demands, his liquid assets, his preferences.
We know more about personnel selection and training, the motiva-
tions which affect productivity, the techniques of management . We
know more about the processes of normal development, the way in
which people learn. We can be quite accurate about short-range pop-
ulation predictions affecting such matters as our requirements for
schools and teachers or our pool of manpower for military service ..
We at least know something about what new knowledge we need to
extend these predictions over a longer range .
These few examples are given to illustrate that our knowledge about
human affairs is increasing, even if slowly and imperfectly, and that
such knowledge as we have can contribute practical benefits while
the search continues . If there are claims being made which seem
overreaching, if social scientists are in disagreement among them-
selves and with the layman, if there are many questions which can-
not be answered, all this is entirely normal . If there are errors and
a danger that we shall be misled by errors, the safeguard is the classic
and traditional one : free debate, the empirical testing of opposing
views, and a standing invitation to confront error with truth . Our
society is deeply in debt to the best of the social scientists . They are
among the most important of today's pioneers.
As far as the Rockefeller Foundation is concerned, we attach no
particular importance to the argument about whether the term "social


science?' is properly used . Some of those who object to it probably
overestimate the certainties of the natural sciences . Some who use it
may claim too much for our knowledge of man . It is our view that
much more can be known about man than we now do and that knowl-
edge is to be preferred to superstition or prejudice . If a little knowl-
edge is a dangerous thing, the remedy is to advance further into the
unknown and seek out its mysteries, not to retreat into enforced
ignorance .
Our foundations have provided funds for promising studies of an
empirical character in the social sciences, largely in the fields of eco-
nomics and human behavior, and we take genuine satisfaction from
them . These studies have been, for the most part, much more than
mere fact finding ; they have been accompanied by a sensitive interest
in generalization and underlying principle . It has been our impres-
sion that those who are engaged in such studies are much aware of the
importance of general concepts and are the first to recognize the in-
adequacies of the tentative generalizations thus far reached . The
final answers have not been found is a reason for continuing the effort
rather than for abandoning the approach.
It should not be surprising that, on a comparative dollar basis, foun-
dation funds might seem to be more heavily concentrated in empirical
studies. They represent a relatively new field for academic develop-
ment and reflect, as the president of the Social Science Research Coun-
cil has pointed out, the pragmatic element in the American experi-
ence. Further, they are expensive and are often beyond the reach of
ordinary college and university budgets . Under these conditions,
foundation support is required if significant advances are to be made .
Alongside of empirical studies, our foundations have been interested
in philosophy and theory and have made many grants for the more
speculative fields. We have an active interest in moral, political, and
legal philosophy, in moral and spiritual values, in the philosophy of
history and the theoretical aspects of economics and international re-
lations. If the amounts have not been large in total, it is partly be-
cause large amounts are not needed, as contrasted with empirical
studies . A further reason is that the special combination of interest
and speculative capacity is somewhat rare, professional opportunities .
are limited, and large numbers of scholars in these fields do not come
forward . Finally, it is not at all clear just how a foundation interest
is best expressed ; perhaps what is most needed is fellowship or grant-
in-aid opportunities for younger scholars and a certain amount of
tree time for older scholars in widely diverse fields who wish to phi-
losophize about their experience and get their thoughts into more sys-
tematic form . These are questions to which we are giving continuous
attention.
V. SPECIFIC QUESTIONS
A. INTRODUCTION
We turn now to the specific questions which the Congress has re-
ferred to this committee for determination . According to the report .
of the committee's director of research, these questions are the fol-
lowing :
Have foundations-
Used their resources for purposes contrary to those for which they were
established?
Used their resources for purposes which can be classed as un-American?

Used their resources for purposes which can be regarded as subversive?
Used their resources for political purposes?
Resorted to propaganda in order to achieve the objective for which they have
made grants? 30
B . CONFORMITY TO CHARTER PURPOSE
The first question cited above is whether foundations have used their
resources for purposes contrary to those for which they were estab-
lished. As to the Rockefeller Foundation and General Education
Board, the answer is clearly "No ."
Let us first consider the foundation . It would surely be hard to find
words of broader import than those used in its charter to describe its
purpose, "to promote the well-being of mankind throughout the
world ." Only one inference can fairly be drawn from this wording
that the intent of the founder was to place no limitation on the dis-
cretion of those who from time to time would be responsible for con-
trolling the destinies of the foundation, so long as their decisions could
reasonably be regarded as contributing to the well-being of mankind .
This was the determination of Mr . Rockefeller, based upon his long
experience of personal giving, and his knowledge of the pitfalls await-
ing donors who attempt to circumscribe too narrowly the purposes for
which philanthropic funds will be available over a considerable period
of years . He preferred to leave the decision as to program and policy
in the hands of succeeding boards of trustees, believing that a trust in
their wisdom and experience was less likely to be frustrated than an
attempt on his part to anticipate the needs of later generations .
Where the charter uses such broad language to describe the organ-
ization's purpose, a strong presumption of validity attaches to the
determinations of its trustee, unless they fall clearly beyond the gen-
erally recognized area of permissible philanthropic giving. Whose
judgment is to be substituted for that of the trustees, as better quali-
fied to determine the purposes for which the Rokefeller Foundation
was established? Is a grant to be condemned as not within those pur-
poses because, for example, it is in support of studies relating to the
United Nations? True, there was no United Nations when the founda-
tion was established in 1913 . But the foundation's charter was framed
to meet the needs of an unforeseeable future. That was the precise
reason for stating the organization's purpose in such comprehensive
terms . Those who would impose a restrictive interpretation on such
language have a heavy burden of proof to carry, and may fairly be
said to expose themselves to the suspicion of wishing to substitute
their own political and economic predilections for the open-minded,
farseeing vision of the foundation's creator .
Turning to the General Education Board, we find that its charter
expresses a similar breadth of purpose . The special act of Congress
incorporating the board in 1902 declared its object to be "the promo-
tion of education within the United States of America without distinc-
tion of race, sex, or creed ." The types of education to be encouraged,
the methods to be pursued, the institutions to be benefited, were wisely
left to the discretion of the Board's trustees . With respect to the
General Education Board we repeat what we have said as to the foun-
80 Transcript, p . 47, ibid., p . 21 .
dation, namely, that those who claim that the organization's resources
have been used for purposes which are contrary to those so broadly
expressed in its charter have a heavy burden of proof to carry, and
one which, we submit, has been far from sustained in this investigation .
A criticism has at times been made that the interest of the Rocke
feller Foundation in the social sciences represented a departure from
"the wishes of the founder ." There was discussion in the foundation
from the beginning about a possible interest in the social sciences ;
Mr. Rockefeller himself established the Laura Spelman Rockefeller
Memorial to carry on his wife's interest in social-welfare activities .
At an early stage the memorial decided to concentrate largely in the
social-science field ; this interest became a part of the program of the
Rockefeller Foundation upon the consolidation of the two philan-
thropies in 1929.
It should be pointed out that John D . Rockefeller, Jr., served as
chairman of the board of trustees of the foundation for 22 years
(1917-39) . He had been intimately associated with his father's devel-
oping philanthropy and served the foundation during the period
when the natural sciences, social sciences, and humanities were added
to its program .
John D . Rockefeller 3d, the present chairman of the board, testified
at some length on this point before the Cox committee in 1952 . 31
There is no credible evidence to support the assertion that our two
foundations have in some reprehensible way departed from the pur-
poses of our founder or the purposes inscribed by public authority in
our charter .
C . ALLEGED SUPPORT OF UN-AMERICAN OR SUBVERSIVE ACTIVITIES
We come next to allegations that the foundations have promoted
"un-American" or "subversive" action . This has been defined to this
committee by its director of research as "any action having as its
purpose the alteration of either the principles or the form of the United
States Government by other than constitutional means." 32
The Rockefeller Foundation and General Education Board would
never knowingly participate in or support un-American or subversive
action. We were requested to report to the Cox committee the names
of recipients of grants who had been listed by the Attorney General
as subversive or who had been cited or critized by the House Un-
American Activities Committee or the Senate Internal Security Sub-
committee . No grant has ever been made by either foundation to a
recipient whose name appears on the Attorney General's list of Sub-
. This list, however, applies to organizations only, not
versives
individuals, and to the best of our knowledge there is no similar
comprehensive list of individuals who have been officially designated
by government as subversive . Consequently, independent philan-
thropic bodies such as our foundations, whose earnest desire is to
avoid gifts to subversive individuals, are without reliable and positive
guidance in making their grants . The House Un-American Activi-
ties Committee has published Cumulative Index V to its publications,
but this document states : "The fact that a name appears in this index
is not per se an indication of a record of subversive activities . It
31 Hearings, pp . 565-568 .
simply indicates that said name has been mentioned in connection

with testimony or a report submitted ." 33
In making their reports to the Cox committee, our two foundations
revealed the names of all grant recipients who, so far as we could dis-
cover, had ever been commented upon adversely by either of the
House or Senate committees above mentioned, or who had been listed
in any report of either committee as having been identified by a wit-
ness as a Communist, as one of a group affiliated with an alleged Com-
munist-front organization, or as one of the participants in some form
of pro-Communist activity . Because they came within one or another
of these categories, the Rockefeller Foundation named 2 organiza-
tions and 23 individuals who had benefited from its grants, and the
General Education Board named an additional six individuals to
whom or for whose support it had made grants.
The reporting of these names was by no means an acknowledgment
by our foundations that the organizations and individuals were in
fact subversive. On the contrary, a number of them have steadfastly
denied under oath any Communist affiliations, and now occupy posi-
tions inconsistent with any serious doubt as to their loyalty . Two of
the individuals have admitted that they were Communists at one time,
-but they have publicly renounced the party . Neither of the two or-
ganizations has been placed on the Attorney General's list of sub-
versive organizations . Furthermore, in most cases the grants were
made by our foundations long before the recipients were named even
in the manner above mentioned, and also before the slightest question
had been raised about them .
Our foundations refrain as a matter of policy from making grants
to known Communists . This rests upon two elements, the clearly ex-
pressed public policies of the United States, within which our founda-
tions operate, and the increasing assaults by communism upon science
and scholarship which would lead our foundations, . on intellectual
grounds alone, to withhold support .
We recognize the necessity for Government to seek out and deal
with subversive activity from any quarter. In this, Government is
entitled to the sympathetic assistance of all responsible citizens .
Where freedom and security are balanced against each other and it
becomes necessary to locate the line which separates permitted and
prohibited conduct, difficult decisions have to be made which reach
into the fundamentals of our society . For example, the definition of
subversion is a matter of extreme difficulty .
On broad grounds of public policy, we believe that private citizens
and organizations should approach unofficial definitions of subversion
with the greatest caution . This is not merely because the task is dif-
ficult, as the Congress has found it to be on the official plane . If pp ri-
vate organizations and associations should produce their own defini-
tions of subversion and should act toward their fellow citizens on the
-basis of such private definitions rather than of those furnished by
duly constituted authority, the mutual confidence and trust which are
the cement of our democratic society would rapidly crumble away .
'The presumption of innocence is more than a luxury to be enjoyed in
settled times ; it is a vital element in a society of freemen who work
-together by consent and not by force . Under the American system,
8° Cumulative Index to Publications of the Committee on Un-American Activities : Index
(Washington, D. C. : U. S . Government Printing Office, 1953), p. 1 .
tyranny in government can be struck down at the ballot box but it is
far more difficult to hold private organizations to proper standards
if these organizations intrude upon security activities which are at the
heart of the governmental function .
A private citizen or organization can properly look to Government
for guidance in matters affecting loyalty and subversion . When one
turns to public laws and to official declarations of public policy for a
definition of the term "subversive," one finds a lack of precision which
itself may reflect differences about what constitutes wise policy in this
field as well as possible concern about the impact of applicable con-
stitutional provisions . For such constitutional provisions as those
concerning treason, bills of attainder, free speech, free press, and due
process of law enjoin caution upon Government lest the voice of the
opposition be silenced by public authority and fair differences of
opinion lead to the persecution of those with whom we do not agree .
We attempt to set standards for our activities and appropriations
which go far beyond any definition of subversion . We believe objec-
tive scholarship to be inconsistent with attitudes predetermined by a
totalitarian ideology or with conclusions which are reached to con-
form to a dictated pattern . The search for the highest quality, for
scholars and scientists of complete integrity, for men and women of
fine character and acknowledged capacity for leadership necessarily
means that questions of loyalty' arise only in the rarest instances .
But we have always kept in mind the importance of the noncon-
formist in the advancement of human thought . This is not com-
munism-it is the antithesis of communism, which regiments its fol-
lowers and tolerates no dissent from the dogma of the Kremlin . Mis-
takes can and will be made and private organizations cannot guar-
antee a perfect record, any more than can an intelligence agency of
Government itself . So long as there is alertness to the dangers in-
volved, and reasonable effort to avoid them, we believe that the public
interest will be adequately protected . It would be gravely injurious
to the public interest if fear should lead to such restrictive procedures
as to impair seriously the work of the foundations at the frontiers
of human knowledge.
We expect Government, acting under the law and the Constitution,
to identify what is subversive. We expect that the standard of con-
duct thus defined will be applied by due process . We believe that
private citizens and organizations are entitled to rely upon a man's
reputation among his fellows for character, honesty, loyalty, and
good citizenship and that private citizens and organizations should
not enter upon certain of the techniques of investigation appropriate
only to Government . We recognize that this is a field of infinite com-
plexity and are prepared to cooperate in any reasonable way to take
account of dangers from any source .
D. SUPPORT OF PRO-AMERICAN PROJECTS
We turn next to the related question whether our foundations have
adequately supported pro-American projects .
Our grants are made almost exclusively to colleges, universities, and
other research and scholarly organizations . We affirm our confidence
in them as patriotic institutions which recognize their obligation to
serve the public interest. The diversity of interest and aspiration
among the American people forbids our thinking of pro-American
in terms of a narrow formula couched in purely political terms . rn-

stitutions which nourish the entire range of the religious, scientific, .
economic, social, artistic, and cultural values of our society are, in
the deepest and best sense, pro-American in character . We know;
of no class of institutions more alive to our basic values and more-
concerned to see them understood and appreciated than are our col-
leges and universities . We know of no better investment in the-
future of our country than our substantial grants to such institutions . .
If we think, not of institutions, but of the kinds of work performed :
or supported, again we believe that our two foundations have con-
tributed immeasurable benefits to our country . We mention, but do~
not emphasize, that a very large portion of our funds has been spent
in the United States . We would suppose that a 35-year campaign
against yellow fever was pro-American and that those who gave their -
lives in the foundation's successful fight against this pestilence served.
America, as well as the rest of mankind, as truly as did the soldier
who gave his life in battle . The building of a giant telescope oni
Mount Palomar, the campaign against hookworm, the large and sus-
tained interest in Negro education, large-scale support for the study
of the economics of a free-enterprise system, the provision for thou-
sands of fellowships, are all examples of activities of which America .
has been a major beneficiary . It does not diminish America's gain_
to know that others benefited as well, nor does it subtract from the-
end result to know that the impetus came from a desire to "promote
the well-being of mankind throughout the world ."
In a somewhat narrower sense, however, our two organizations .
have consciously sought ways and means of contributing to the-
strengthening of our national life . This has been expressed in large
support for medical education in the United States, in grants for ex-
tensive studies of our own economy, in support for studies of our
legal and constitutional system, our State and local governments, by
interest in national, regional, and local history, in support for both
creation and appreciation in the arts . Materials available to the
committee will show many hundreds of grants for such purposes . In
American history, for example, they will show 33 grants in 1953, 27 in
1948, and 25 in 1943-just to take 3 typical years .
In addition to American studies in the United States, we have en-
couraged American studies abroad, parallel to area studies of other
cultures in this country, as a means of establishing a base of knowl-
edge for broader and more accurate understanding between Ameri-
cans and the peoples of other cultures . Grants for this purpose have
gone to such universities as Oslo, Munich, Ankara, Tokyo, Kyoto, and
Doshisha, to name a few .
We see no basis for any assertion that we have been negligent about
the interests of our own country in carrying out the mandates of our
charters.
From the context in which the question of pro-American projects
was introduced, we infer that it was intended to raise the question of
foundation support specifically for patriotic organizations . Nothing
we say is intended to depricate in any way the value of patriotic and
civic societies, which keep alive a love of country and a respect for the
American tradition . In a free society, particularly where there is a
strong emphasis upon individual liberty and initiative, there is an
important role for those who regularly remind us of the claims of the
-Nation upon our interest and loyalty. But we question whether the
Congress would wish to use its investigatory or tax power to press
particular claimants upon philanthropic funds which are entrusted
by law to the judgment and discretion of boards of trustees . Such
claims, if officially supported, would quickly multiply until they en-
-compassed every worthwhile purpose in our society and would not
.obviate the ultimate need to make difficult choices in applying limited
funds to vast human needs . It is not surprising that our foundations,
-which have largely concentrated upon basic research and support in
-certain fields for institutions of higher education, should have had
Tittle or no contact with patriotic, veteran, or civic groups whose ac-
tivities are of a quite different nature . We have supposed that it has
:been well understood that we have elected to work in other directions,
since we have very little correspondence in our files from such groups
raising the possibility of foundation support. Such as we have con-
- cerns itself largely with local hospitals or other local charities which,
from the beginning, it has been the policy of our organizations not to
.assist .
There are some indications in the record of these hearings that the
-term "pro-American" includes repentant Communists. We know of
repentant Communists who have benefited directly or indirectly from
our grants . If it transpires that a former Communist is to be in-
cluded among those to benefit from a proposed grant, our inclination
would be to make a judgment, however hazardous it might be, on the
merits of each particular case-a judgment as to the ability, charac-
ter, integrity, and present loyalty of the individual concerned . The
fact that a person may in earlier years have been a Communist would
not in itself disqualify him for a foundation grant . Nor does the fact
-that he has repented give him a claim to foundation assistance superior
to that of persons without a Communist record .
The committee will recognize that the problem is not a simple one .
For it, apparently, is only in very special cases that a former Commu-
nist and his sponsoring institution gain immunity from continual
harassment . Further, a difficulty arises in applying our usual tests of
high intelligence, strong character, qualities of leadership, and unus-
ua1 promise for the future. One questions whether there is particu-
larly fertile ground for foundation aid among those who have already
demonstrated political naivete, and have shown a willingness to sub-
mit their minds and spirits to totalitarian discipline . We are not pre-
pared to express a general view on such cases ; it is a matter to which
we have given considerable thought and which will continue to re-
, ceive our attention . It is also one of the questions about which public
policy needs clarification by those in responsible authority .
E . ALLEGED "POLITICAL" ACTIVITIES
Another allegation has been that foundations have promoted "polit-
ical" activities . On this the Rockefeller Foundation and General
Education Board enter a categorical denial and observe that no evi-
dence whatever has been produced which relates us in any way to
support for any political candidate or any political party .
On our boards of trustees are some who, quite outside of their service
to our foundations, have publicly identified themselves with one or
the other major political party . Some trustees have accepted public
service, whether political or nonpolitical in character, under every

administration in office since our foundations came into existence .
Many trustees, however, have not indicated a political position, even
to their fellow trustees . We do not ask trustees or prospective trustees
about their politics and have no intention of doing so . Emphasis is
upon the nonpolitical and nonpartisan character of our work . The
same holds true insofar as our officers are concerned . It is clearly
understood that no one connected with our foundations may properly
identify these philanthropic institutions with political partisanship in
any form.
Since it is well understood that we do not participate in partisan
politics, the criticism has taken the form of a charge that we have
favored "attitudes normally expected to lead to legislative action." s'
Such a charge eludes examination . The Rockefeller Foundation and
General Education Board do not adopt "attitudes normally expected
to lead to legislative action." We have supported studies about a
wide range of human affairs, the purpose of which has been to add to
our knowledge and to illuminate problems with fact by seeking out the
underlying acts and principles . If legislatures make use of such
knowledge in the course of lawmaking, the relation is much too remote,
and the intervening factors far too complex, to sustain a charge that
the work of our foundations has promoted "political activities ."
F . ALLEGED "PROPAGANDA"
This investigation has heard a great deal of talk about "propa-

ganda," coupled with the specific charge that foundations have vio-
lated their tax-exemption privilege by carrying on "propaganda"
activities. The Rockefeller Foundation and the General Education
Board deny this charge and affrm that we have exercised great care
to avoid any such infraction of our tax-exemption privilege . No in-
quiry has ever been directed to the Rockefeller Foundation or the
General Education Board by the Bureau of Internal Revenue or the
Internal Revenue Service raising any question of violation in con-
nection with any grant ever made by either organization .
Where support has been extended to studies in political science,
economics, sociology, or international relations, areas in which con-
troversy is almost unavoidable, these boards have never sought to pro-
mote a partisan or doctrinaire approach to the subjects, but have been
interested solely in the highest standards of objective, scholarly re-
search . If in rare instances the recipient of a grant has departed
from these standards, this has not been done with the consent or
approval of our organizations.
The trustees of the Rockefeller Foundation, to their abiding honor
be it said, have held true to the concept of trusteeship which has for-
bidden them to employ the large funds under their control for ad-
vancing the ideas or interests of any particular class or school of
thought. It is significant that the most violent and unrestrained
charges of "propaganda" have come from the mouth of a witness who
seriously maintained that the Federal income tax reflected a Socialist
plot to destroy the Government ." This is the man who charges that
the foundations, through their influence on education, "are directly
32
Transcript, p. 27, ibid . p. 17 .
36
Transcript, p. 526, ibil ., p. 210 .


involved" in a movement which is "the greatest betrayal which has
ever occurred in American history ." ss
It should be a sufficient answer to these irresponsible allegations
for the Rockefeller Foundation and the General Education Board to
point to the roster of leading citizens drawn from many walks of life
who for periods of 41 and 51 years, respectively, have guided the ac-
tivities of these two organizations as members of their boards of
trustees and as officers . They have included bankers and corporation
executives, officers of leading universities, eminent figures in medi-
cine and the law, Nobel Prize winners, outstanding newspaper ub-
lishers, occupants of high governmental office . They have come from
no one section of the country, and have been chosen with complete
disregard for partisan political affiliation . It is beyond belief that
these men have been guilty, as charged before this committee, of either
perpetrating or conniving at "the greatest betrayal" in American his-
tory, or of not knowing what they were voting funds for . Such
charges are, we submit, false on their face, irresponsible in origin,
and an imposition on the time and attention of this committee .
What are the controlling rules and principles with respect to propa-
ganda activities and their effect on the tax exemption of foundations?
They have been plainly stated for the benefit of this committee by the
Assistant Commissioner of Internal Revenue, Mr . Norman Sugarman.
He has referred to section 101 (6) of the Internal Revenue Code, which
grants exemption to any foundation-
* * * organized and operated exclusively for religious, charitable, scientific,
literary, or educational purposes * * * no part of the net earnings of which
inures to the benefit of any private shareholder or individual, and no subst4n-
tial part of the activities of which is carrying on propaganda, or otherwise
attempting, to influence legislation ." [Italics supplied .]
The italicized words were added by an amendment adopted in 1934 .
As Mr. Sugarman said
The committee reports and the language of the 1934 act establish that the
words "carrying on propaganda" do not stand alone, but must be read together
with the words "to influence legislation ." Thus the law expressly proscribes only
that propaganda which is to influence legislation ." 3'
* * * * * * *
Congress saw fit only to circumscribe the exemption with a restriction against
substantial activities to influence legislation ."
As Mr. Sugarman also pointed out, the income-tax regulations de-
fining what is an educational organization entitled to exemption throw
additional light on the meaning of the word "propaganda" as it is used
in the tax law . This paragraph (regulations 118, sec . 39, 101 (6) -1
(c) ), after stating that an educational organization is one designed
primarily for the improvement or development of the individual, adds
that, under exceptional circumstances, it may include "an association
whose sole purpose is the instruction of the public," and continues as
follows
An organization formed, or availed of, to disseminate controversial or partisan
propaganda is not an educational organization within the meaning of the code .
However, the publication of books or the giving of lectures advocating a cause
of a controversial nature shall not of itself be sufficient to deny an organization
the exemption, if carrying on propaganda, or otherwise attempting, to influence
88
3' Transcript, pp . 925-926, ibid ., p . 436 .
88 Transcript, p . 934, ibid ., p. 433 .
legislation forms no substantial part of its activities, its principal purpose and
substantially all of its activities being clearly of a nonpartisan, noncontroversial,
and educational nature.
We think the committee will be interested in comparing those pro-
visions of the law and the regulations with the definition of propa-
ganda which the committee's director of research, after 6 months'
study, offered as a guide to assist in determining the question whether
foundations had forfeited their exemption by their conduct in this
field . That definition is as follows
Propaganda-action having as its purpose the spread of a particular doctrine
or a specifically identifiable system of principles * * * in use this word has come
to infer half-truths, incomplete truths, as well as techniques of a covert nature ."
In spite of his reference to half-truths, incomplete truths, and tech-
niques of acovert nature, not a word in the report would suggest that,
as Mr. Sugarman later so clearly demonstrated, "propaganda" was
not forbidden to a tax-exempt organization unless it is used "to in-
fluence legislation ."
In order to be sure that it is conforming to public policy in this re-
spect, the Rockefeller Foundation follows the practice of making no
grants to any American organizations which have not themselves
established their right to tax exemption by a ruling of the Commis-
sioner of Internal Revenue .
G. ALLEGED " INTERNATIONALIST" BIAS
In his report to the committee, its director of research stated that his
studies of foundation activities "seemed to give evidence of a response
to our involvement in international affairs' 4 0 While we were at first
inclined to believe that this was intended as a compliment, a closer ex-
amination of the context made it plain that it was offered as a deroga-
tory allegation . This was confirmed by our study of part II of a later
report by the committee's legal analyst, received by us on July 19, 1954,
which purported to deal with the "internationlist" activities of the
Rockefeller Foundation. Before examining some of the curious
charges made in these staff reports, it might be well to look at some
facts.
The foundation is a philanthropy whose activities are not limited by,
national frontiers and whose charter purpose is the promotion of "the
well-being of mankind throughout the world ." It has been active in
varying degree in more than 90 foreign countries or territories. It
now has offices or laboratories in London, Paris, Tokyo, Cairo, New
Delhi, Poona, Mexico City, Bogota, Medellin, Rio de Janeiro, Belem,
Port of Spain, Ciudad Trujillo, Lima, Santiago, Johannesburg . Its
officers travel into almost every area on this side of the Iron Curtain .
The international character of the foundation's work has been one
of its major characteristics . Whether in medicine and public health,
natural sciences, agriculture, social studies or the humanities, the
foundation has sought the most fertile ideas, the most urgent needs,
the most capable men, and the most promising institutions wherever
they could be found . There is nothing mysterious or sinister about the
reasons for this.
90 Transcript, p . 45, ibid ., p . 20.
TAX-'EXEMPT FOUNDATIONS 1103
First, Mr, Rockefeller's philanthropic interest was worldwide in
scope, and was rooted in the sympathetic concern which Americans
have shown for the needs of people in other lands throughout
our history.
Second, an attack up certain types of problems, such as yellow fever,
malaria, wheat stem rust, compels a pursuit of the problem across na-
tional boundaries .
Third 2 the general body of knowledge, scientific or otherwise, is an
international heritage and grows through the labor of scientists and
scholars in many centers of learning, in many laboratories, in many
countries. The most cursory glance at the list of Nobel prize winners
and the most elementary understanding of the history of our culture
make it clear that this is so .
Fourth, any philanthropy which is committed to an interest in the
well-being of mankind throughout the world cannot reasonably ignore
the vast problems which are comprised in the term "international re-
lations ." If this was true in earlier decades, it is underscored with
fateful emphasis by the statement of the American Secretary of State
at the 1953 meeting of the General Assembly of the United Nations
that "Physical scientists have now found means which, if they are de-
veloped can wipe life off the surface of this planet." 41
We accept as an established fact that the United States is involved

in international affairs and that this involvement produces an impact
upon every home and every citizen . It is as much a part of the en-
vironment in which we live as is the air we breathe .
This recognition does not mean that the Rockefeller Foundation has
any formula of its own as to just how the problems of international
relations should be resolved . We have no corporate position on such
questions as World Government, Atlantic Union, the role of the United
Nations, international trade policies, regulation of armaments, se-
curity alliances, and so forth . We believe that problems of relations
among peoples and governments are proper subjects of examination
and study, that knowledge about them is to be preferred to ignorance,
and that reliable information will put men into position to make wiser
decisions.
In the field of international relations, the foundation has pioneered
in what has come to be called technical assistance, primarily in such
fields as medicine, public health, and agriculture . In addition, it has
provided support for studies or for creative work in such fields as in-
ternational economics, international law, comparative government,
history, creative arts, and the so-called area studies . that is, studies
which cut across cultural boundaries and establish a bridge of infor-
mation and understanding despite differences in language, race, creed,
are cultural tradition .
We have attempted to be helpful and cooperative in our attitude
toward existing machinery of international cooperation, whether the
League of Nations, the United Nations, the World Health Organiza-
tion, the Food and Agriculture Organization, etc . Where an inter-
national body is undertaking work in which the foundation has an
interest, an occasional grant has been made by the foundation to sup-
port such work . On other occasions officers and staff of the founda-
4%
The Department of State Bulletin, vol . .XXIX, No . 744, Publication 5196 (Washington,
D. C . : II . S . Government Printing Omce, September 28, 1953), p . 404 .
49720-54-pt. 2-11
tion have been loaned to international organizations for particular

jobs, as in the field of medicine and public health . In working with
international organizations, the foundation does not enter into the
political discussions and decisions which might be made by those
bodies . Our collaboration rests upon a joint interest in activities ap-
propriate to philanthropy .
A complaint has been made that we have directed education "to-
ward an international frame of reference ." 42 What we have done
has been to provide financial support to colleges, universities, and
other educational bodies to enable them to do what they themselves
have wanted to do, namely, to study the world outside as well as inside
the United States and to find a reasonable place in school and college
curricula for learning about other peoples and their cultures as well as
our own. We find it puzzling to be called upon to defend what seems
to us to be so obvious, that American scholarship should encompass
other cultures and that educated Americans should know something
about the world in which they live . This is particularly true today
when American citizens are called upon to have reliable information
and balanced judgments about complex international issues which
affect the the very life of the Nation .
Turning to part II of the report of the committee's Legal Analyst,
it is not easy to discover exactly what our sins are supposed to be.
Indeed, its preface states : "There is no distinction here as between so-
called good or bad activities of the foundations * * * "
The report contains a number of statements which are clearly in
error. For example : "As a matter of fact, the [Carnegie] Endow-
ment and the foundation concentrated their grants among the same
agiences in practically every case ." 43 This is simply not true, quite
apart from whether it would have been reprehensible .
Again, the report refers to "* * * activities of the foundation
in connection with 'one-world' theories of government and planning
on a global scale * * *,» 44
If the expression "one-world theories of government" means any-
thing, it means world government. No shred of evidence is presented
in the report to show that the Rockefeller Foundation or any of the
organizations to which it has made grants has advocated world gov-
ernment. In an appendix referred to as Exhibit-Rockefeller, the
report gives a number of quotations from our annual reports and
president's reviews . One of these, taken from the 1946 president's
review, reads : "The challenge of the future is to make this world
one world-a world truly free to engage in common and constructive
intellectual efforts that will serve the welfare of mankind everywhere ."
That this sole reference to "one world" (an expression first popu-
larized by a former Republican candidate for the Presidency) had
nothing whatever to do with world government is apparent .
The legal analyst's report, part II, contains the following
paragraphs :
There is nothing ambiguous about the warning on page 9 of the 1941 annual
report of the foundation
"If we are to have a durable peace after the war, if out of the wreckage of
the present a new kind of cooperative life is to be built on a global scale, the
part that science and advancing knowledge will play must not be overlooked ."
42
Hearings, n . 20 .
'3 Report of the Legal Analyst, pt . II, hearings, p . 882 .
41 Report, pt . II, ibid ., p. 871.


This statement appears in the report for the 12-month period ending Decem-
ber 31, 1941-not quite four weeks after Pearl Harbor-yet there con be no
doubt that as far as the foundation was concerned only "a cooperative life
on a global scale" could insure "a durable peace ."''
We gladly reaffirm the quoted portion of the 1941 annual report
but it is interesting to see the full context. We quote three full
paragraphs :
"If we are to have a durable peace after the war, if out of the wreckage of
the present a new kind of cooperative life is to be built on a global scale, the part
that science and advancing knowledge will play must be overlooked . For
although wars and economic rivalries may for longer or shorter periods isolate
nations and split them up into separate units, the process is never complete
because the intellectual life of the word, as far as science and learning are con-
cerned, is definitely internationalized, and whether we wish it or not an indelible
pattern of unity has been woven into the society of mankind .
There is not an area of activity in which this cannot be illustrated . An
American soldier wounded on a battlefield in the Far East owes his life to the
Japanese scientist, Kitasato, who isolated the bacillus of tetanus. A Russian
soldier saved by a blood transfusion is indebted to Landsteiner, an Austrian .
A German soldier is shielded from typhoid fever with the help of a Russian,
Metchnikoff. A Dutch marine in the East Indies is protected from malaria
because of the experiments of an Italian, Grassi ; while a British aviator in
North Africa escapes death from surgical infection because a Frenchman,
Pasteur, and a German, Koch, elaborated a new technique .
In peace as in war we are all of us the beneficiaries of contributions to knowl-
edge made by every nation in the world . Our children are guarded from diph-
theria by what a Japanese and a German did ; they are protected from smallpox
by an Englishman's work ; they are saved from rabies because of a Frenchman ;
they are cured of pellagra through the researches of an Austrian . From birth
to death they are surrounded by an invisible host-the spirits of men who never
thought in terms of flags or boundary lines and who never served a lesser loyalty
than the welfare of mankind . The best that every individual or group has
produced anywhere in the world has always been available to serve the race of
men, regardless of nation or color ."
Apparently the focus of interest of the legal analyst's report,
pt. II, is to be found in the following quotation from its first page :
At the same time that Carnegie and Rockefeller agencies weree concentrating
on the chaotic condition of education in the United States (discussed in pt . I),
organizations hearing the same family names were focusing attention on other
types of conditions which in the opinion of the trustees required improvement .
While these so-called problems covered such varied fields as public health,
malaria in Africa, and exchange of professors and students of international law,
there was an indirect relationship between them, and also between them and
education : namel, all of them were on the periphery-if not directly in the
center-of international relations and governmental activities .
That both the foundation and the endowment did carry on activities which
would directly or indirectly affect legislation is borne out by their own state-
ments, as found in their annual reports .
That they both engaged in propaganda-as that word is defined in the dic-
tionary (on page 49 of the report this becomes "in the sense defined by Mr . Dodd
in his preliminary report"), without regard to whether it is for good or bad
ends-is also confirmed by the same source .
That both had as a project "forming public opinion" and "supplying in-
formation" to the United States Government to achieve certain objectives, in-
cluding an internationalist point of view, there can be no doubt .
None of these results is inherent in the purposes of either of these or-
ganizations.
Our comments on the above quotation follow
(1) The Rockefeller Foundation has carried on public health ac-
tivities, fighting malaria and yellow fever, for example, in many for-
45 The
Report, pt . II, hearings, p . 895 .
Rockefeller Foundation, annual report, 1941, pp . 9-11 .
46

eign countries, and has invariably had cordial relations with the
governments of those countries . The suggestion that there was an
"indirect relationship," apparently regarded as sinister, between these
activities and other "on the periphery" of "'international relations'
and `governmental activities"' is so vague and unintelligible that we
can make no reply without further specifications .
(2) It is true that studies supported wholly or in part by our grants
may have indirectly affected legislation . The intelligent and alert
legislator is constantly in search of help from the work of scholars, and
like the experienced foundation officer, is quick to distinguish between
true, objective scholarship and propaganda masquerading as such .
Does the legal analyst mean to suggest that foundations should with-
hold support from sound, independent scholars for fear that their
studies will not remain sterile, but will impress legislators sufficiently
to influence their official action?
Neither of our foundations have ever been directly involved in an
attempt to influence legislation affecting the subject matter of its
grants or has ever made a grant to an organization for the purpose of
assisting is in influencing legislation .
(3) As to the allegation that the foundation has engaged in propa-
ganda, our first observation is that even if the definitions of this word
referred to by the legal analyst are accepted as relevant, the charge
cannot be sustained . We have never offered remedies of our own as a
cure for public problems . We cannot suppose that the term is in-
tended to apply to foundation publications emphasizing the impor-
tance of fighting disease, the desirability of constantly advancing the
frontiers of knowledge, or the urgent need for peace in a troubled
world .
But the fact is that the definitions of propaganda referred to are not
relevant to this inquiry because they ignore the statutory qualifica-
tions of this word as it is used in the section of the Internal Revenue
Code dealing with tax-exempt institutions . As Mr. Norman Sugar-
man, Assistant Commissioner of Internal Revenue, brought out in his
testimony, the Internal Revenue Code denies exemption on account of
propaganda activities only where the alleged propaganda is designed
to influence legislation ." The only institutions in the United States
receiving grants from our foundations are institutions whose right to
tax exemption has been affirmed by executive ruling. As against the
legal analyst's viewpoint, we adopt and follow the determinations of
those who are charged with the duty of applying and enforcing the
definition as it appears in the Internal Revenue Code .
A possible key to a better understanding of the report is to be found
on page 59
There has been a singular lack of objectivity and a decided bias toward a so-
cialized welfare state in the proposals of these organizations, and every effort
has been made by them to advance the philosophy of "one world" to the complete
disregard of comparable effort on behalf of a more "nationalistic" viewpoint .
We have commented earlier (p . 15) on increases in Federal powers
and expenditures, probably referred to in the above quotation as "a
socialized welfare state ." What is the more "nationalistic" viewpoint
to which reference is made? Just as we do not use our funds to sup-
port doctrinaire world government, neither do we use them to support
47 See our discussion on p . 1100 ante .
doctrinaire isolation . It is precisely at points where such extreme
views converge in controversy that research and scholarship can con-
tribute to our public life .
The committee's staff reports repeatedly confuse the study and dis-
cussion of public issues with the systematic propagation of particular
points of view . There is much evidence that we have given financial
support to the processes of study and discussion because, indeed, we
have. There is no evidence that we have, as foundations, systemati-
cally urged solutions of our own, for we have not .
The legal analyst's report concludes with 32 pages of quotations
from the publications of the Rockefeller Foundation during the years
1932-51. We regret that there is not space to reprint them here for
we would stand on them now . We see no conflict between respect for
our own national life and culture and a desire to increase "the infinity
of threads that bind peace together" through channels of international
cooperation. It is on this basis that we have made large numbers of
g rants both for the strengthening of our own national life and for
more accurate and deeper understandings across national frontiers .
H . ALLEGATIONS OF FAVORITISM
We turn next to the charge that "only a few [colleges] had partici-
pated in the grants which had been made" by foundations and that
foundations have been guilty of "favoritism in making * *
grants." 48 Such charges have no basis in fact when applied to the
Rockefeller Foundation and the .General Education Board, but we
would not wish the wide scope of our grants to becloud an underlying
issue. Our position is that the concentration or dispersion of grants
is a matter which lies within the discretion of our trustees . They
have no obligation to effect a wide distribution of their funds ; the test
is whether they have reasonable ground to believe that their appro-
priations promote our charter purposes . In stating the facts as to the
wide range of institutions which have received our grants, we wish to
avoid even the appearance of criticism of any foundation which might
have concentrated upon a single or a few institutions .
A study of grants made by the foundation since its establishment in
1913 and of grants made by the General Education Board since it was
chartered in 1903 reveals the following facts as of December 31, 1953 .
The number of institutions and organizations in this country that
have received grants from one or both of these boards totals 1,061 .
These institutions are distributed in 45 States and the District of
Columbia. If assistance given through the foundation's operating
program in public health is included, the distribution of funds covers
all 48 States .
The Rockefeller Foundation has made grants to 611 institutions
and organizations in the United States, involving a total of over $216
million . This figure does not include grants for our operating pro-
grams in public health and agriculture, or for fellowships and travel
grants. The 611 recipient institutions were located in 41 States and
in the District of Columbia . They were both public and private and
included great universities, small independent colleges, agricultural
colleges and institutes of technology, medical schools and teaching
hospitals, special laboratories, art institutes, symphony societies, mu-
4s Hearings, pp . 18, 19, 20 .
1 108 - TAX--EXEMPT- FOtN17ATIONS
seums, special research bureaus, and various organizations of scholars

and scientists.
The General Education Board's record also shows a wide distribu-
tion and a great variety in the types of institutions to which grants
were made . Grants have been made in 44 States to 598 organizations .
They were made to public and private universities, small liberal arts
colleges, State departments of education and agriculture, State
teachers colleges and normal schools, agricultural and technical insti-
tutes, libraries, community schools, medical colleges, museums, and
various scholarly and professional organizations .
It should be stressed, however, that it has not been the objective of
the Rockefeller boards to distribute their funds with a view to secur-
ing extensive institutional representation or geographic coverage .
Rather they have sought to place their funds wherever they would
most effective in carrying out the purposes of their charters .
Thus, in an effort to improve knowledge and practice in the field of
public health, the foundation made large grants to Harvard Univer-
sity and John Hopkins University, institutions which were prepared
to establish strong schools of public health, whose faculties could fur-
nish leadership not only within their own institution and locality but
for the field of public health as a whole .
Likewise in seeking to advance knowledge of the biological sciences,
grants were made to institutions that had built up strong departments
in this field and had attracted to their faculties scientists who were en-
gaged in significant research . Advanced research in this field is car-
ried on most effectively where there is ready association with scientists
working in related fields, such as physics and chemistry, where con
tact is possible with doctors trained in medicine, surgery, dermatol-
ogy, etc., where laboratory facilities are generous and graduate as-
sistants are available . Hence, large grants for the expenses of
research in biology have been made to such institutions as the Massa .
chusetts Institute of Technology, Stanford University, Johns Hop .
kins University, and California Institute of Technology, not because
these institutions were located in particular sections of the country,
or because they were favored institutions, but because they offered
exceptionally good opportunities to advance knowledge in a certain
field.
While it is true that the total funds given to such great universities
as Columbia, Harvard, Chicago, and California were considerably
larger than those given to many other institutions, the reasons for
this lay not in any favoritism toward the institutions but in the fact
that they gave clear evidence of interest and significant achievement
in important fields of learning and had demonstrated their ability to
provide an especially favorable setting for the advancement of re-
search and training in these fields .
Support for our great universities results in direct benefits to insti -
tutions in all parts of the world through the advanced training which
they are able to offer . For example, the Rockefeller Foundation
has given large grants in support of chemistry and biology at the Cali-
fornia Institute of Technology . In the last 5 years alone, 314 post-
doctoral faculty members of some 200 colleges and universities in the
United States and abroad have taken advanced training in these 2
departments alone . Ninety-nine doctor of philosophy degrees have
been given to representatives of an almost equal number of insti-
tutions .
The Rockefeller Foundation has given $4,687,083 .90 to the Harvard
University School of Public Health . In the years 1950, 1951, and-
1952, 119 graduates were distributed across the length and breadth of
the country, with 21 going to the Army, Navy, and Air Force ; 22 to
the United States Public Health Service ; 42 to local and State health
services ; 19 to teach in other centers ; and the remaining 15 to other
posts.
It is also relevant, in view of the charge that foundations tend to
favor the large institutions, to point out that some of them became
large and strong because of substantial foundation assistance . Chi-
cago, Emory, Vanderbilt, Tulane, California Institute of Technology
are among those whose growth has been actively encouraged by funds
from the Rockefeller boards ; Duke is an example where large sup-
port has come from another foundation.
In all these grants, no individual project or institution has been
considered an end in itself . Rather an effort has been made to choose
for assistance only those projects or persons that gave promise of
becoming, in the words of one of our early trustees, "the, seed corn for
the future." The idea is to help establish standards that will lead to
continuous improvement in the quality of research and scholarship .
This has been true in the program of the General Education Board
as well as in that of the foundation, although geographical considera-
tions played a greater role in the work of the board, which recognized
a special regional interest in the South . From the beginning, the
board stressed the importance of establishing standards of excellence
and strove, not to help all institutions, or even those whose need was
greatest, but rather to strengthen a number of soundly established
colleges and universities in strategic locations so that they would set
standards and stimulate similar development in other institutions of
the region, and thereby contribute enduring benefits to all education
in this country . Grants involving more than $190 million (in amounts
of $1 million or more) for endowment, buildings and equipment, and
for the increase of teachers' salaries, were made to 37 colleges and uni-
versities scattered throughout the country . Because of the special
needs of the southern region 21 of these institutions were in the South.
If some of them received substantially more than others, the answer
may be found both in their needs and in the opportunities they offered
for contributing to the strength of American education . A further
explanation lies in the high cost of certain kinds of education-such
as medical education. For example, board grants for the building,
equipment, and endowment of the School of Medicine and a Teaching
Hospital at Vanderbilt University ; Nashville, Tenn ., totaled $15 mil-
lion . Similarly, grants for Meharry Medical College in Nashville,
for the training of Negro doctors, totaled $4,800,000 .
We are very much aware that the legitimate needs of the Nation's
schools and colleges are vastlyy greater than the total resources of our
two organizations. We have not taken the view, however, that since
we could not do the entire job we should do none of it . Consequently,
choices had to be made.
The General Education Board has spent over 80 percent of its re-
sources in direct support of institutions of higher education . That en-
dowment, capital plant, and other forms of basic support were con-
sidered vitally important (and proved to be costly) is testified by

the fact that the board now terminates its 51 years of activity, having
spent its capital and income, as well as substantial grants from the
Rockefeller Foundation, for the purposes for which it was created .
There has been no regret that the continued activity of the board it-
self seemed less important than the encouragement which its funds
could give to our colleges and universities . There was regret that more
funds were not available to continue a job which was in no sense com-
pleted . We hope that others will see in the experience of the General
Education Board the deep and enduring satisfaction which comes
from investment in vital institutions of learning .
In the case of the Rockefeller Foundation it continues to commit a
large share of its resources to institutions of higher education (over
50 percent in 1953) . Some indication of the relation between our
assets and the existing need is given by the fact that our colleges and
universities, in the United Statees alone, could wisely use in a single
year additional funds equal to the present assets of the foundation .
I . RELATION WITH THE UNITED STATES GOVERNMENT

Some mention has been made in these hearings of an alleged "pur-
poseful relationship" or "operational relationship between founda-
tions, education, and government ." 49
That there are many relationships between education, particularly

public education, and government is a matter of common knowledge .
The annual expenditure of approximately $7 billion of public funds
for education, the many services which educational institutions pro-
vide for Government by contract or otherwise, and the importance
to the Nation of a well-educated population, are major elements in
this common interest.
The very limited relations which the Rockefeller Foundation and
General Education Board have had with government are appar-
ently not so well understood . We have been concerned to preserve
our nonpolitical and nongovernmental status . While acting within
the broad framework of public policy, we do not consider that we are
agents or instruments of government. We have no clandestine
arrangements with government ; we are independent philanthropies
committed to publicly known purposes and activities .
Our operational contacts with government arise in the following
wa s
(a) We are encouraged by public official statements to continue
our activities abroad as an expression of technical assistance in the
private nonpolitical field .
(b) Our officers traveling abroad sometimes pay calls upon Ameri-
can Embassies, Legations, and consulates and exchange general in-
formation about the situation in a particular country, as do American
businessmen or other citizens traveling abroad .
(c) On occasion, an officer or officers of the foundation may be
asked to serve in an individual capacity on some governmental ad-
visory body. The foundation accepts the public duty to free a por-
tion of the time of its personnel for such service, even though the
service itself is not rendered as a representation of the foundation .
A9 Ibid ., p . 20 .
TAX-EXEMPT FOUNDATIONS
(d) The foundation, with a long experience in what has come to

be called technical assistance, is sometimes consulted by public offi-
cials in regard to methods of rendering such assistance, but this has
happened infrequently .
(e) Our two boards have made grants for -projects sponsored by
agencies of government, such as the Library of Congress, the United
States Office of Education, the Department of Agriculture, the
United States Public Health Service, State departments of educa-
tion, State boards of health, local government agencies and, of course,
to State-supported colleges and universities .
J . SCHOOL AND COLLEGE CURRICULA
It has also been charged that foundations have been responsible

for "changing both school and college curricula to the point where
they sometimes denied the principles underlying the American way
of life" 49 and for promoting "a national system of education ." B0
Our two foundations have had neither the power nor the intent
to bring about such changes . Responsibility for American public
education rests with 48 State boards or State departments of education
and with some 99,000 local school boards whose members are chosen in
accordance with the laws of their communities . It has been noted that
among the outstanding characteristics of the American system of
education are its diversity, the absence of centralized control, and
acceptance of both public and private agencies in the accomplishment
of its purposes .
The vast majority of young people in the United States are edu-
cated in publicly supported and publicly controlled institutions . In
1950 attendance at the public elementary and secondary schools and
at public institutions of higher education was 2,6,564,436 ; at private
institutions it was 4,723,132 . 51 Standards and regulations for the
accreditation of public school teachers are determined by State laws
and State boards of education, and teachers' salaries are determined
and paid by local school boards or under authorities approved by
State legislatures .
The past few decades have witnessed numerous new developments
in American education . One of the greatest factors in this change
has been the phenomenal growth of our school population . From
1900 to 1950 the enrollment in our public secondary schools rose-from
519,257 to 5,706,734. 52 This meant not only a tremendous increase in
the number of teachers required and more facilities for training them,
but it almost completely changed the job of the secondary school .
Instead of dealing with a student body of fairly similar background
and purposes, it had to provide for the educational needs of young
people who varied greatly not only in their economic and social back-
grounds, but in their abilities, their interests, and their plans for the
future . In many communities not more than 5 percent would go on
to college, and the traditional college preparatory curriculum had
little meaning for them.
41m Ibid., p . 20 .
Ibid ., p 48 .
s1U. S . office of Education, Biennial Survey, 1948-50 (Washington, D . C. : U . S. Gov-
ernment Office, 1953, ch . I, table 3, p . 6.
62 U . SPrinting
. Bureau of the Census . Statistical Abstriet of the United States : 1958 (Washing-
ton., D. C. : U . S . Government Printing Office, 1953), table 140, p . 125 .

This big change had its impact also on the colleges when the prob-
lem arose of articulating the secondary school's curriculum with the
college curriculum, when college enrollments also began to show large
increases, and when changing teacher certification requirements and
the need for more teachers laid new burdens on teacher-training
facilities .
All these changes led to much discussion among educators about
ways in which the secondary schools and colleges could be improved .
A number of State departments of education began studies of the
problem, as did a great many educational organizations, such as the
National Education Association, the American Association of School
Administrators, the American Council on Education, the Progressive
Education Association, the American Historical Association, the
Mathematical Association of America, and the Society for Curriculum
Study . The United States Office of Education made a national survey,
arranged for conferences, and issued a publication on Needed Research
in Education, and the various university schools of education en-
couraged their faculties to undertake studies of the problems of gen-
eral and teacher education .
Some of the witnesses before the committee seem to regard these
activities as the fruit of a malevolent impulse to subvert our institu-
tions . No doubt some of the studies referred to were unproductive,
or went off on the wrong track. Teachers and college professors are
as liable to error as the members of any other profession . But the
wholesale accusations against our leading teachers' organizations,
which have occupied so much of the committee's time, are believed to
rest upon a perversion of the facts and to be an unwarranted attack
upon the loyalty, patriotism, and intelligence of a devoted group of
public servants.
During the period of rapid change in our school population, new
teaching devices had become available to the schools in the form of
radio and films, research had produced a number of new methods of
testing and measuring, studies of human behavior were throwing new
light on the learning process, and advances in science made it necessary
to change the content of many courses of study .
Meanwhile, the country was not only undergoing a vast industrial
development but experiencing a great economic depression and two
world wars . These were the things that were responsible for chang-
ing American education-and not the activities or funds of any
foundation .
With so many cataclysmic changes occurring in so brief a time,
it is difficult to assign relative importance to the various forces just
mentioned. Few can doubt, however, that the great depression of
the thirties was a prime factor in a reappraisal of educational thought .
In a period of insecurity, it was but natural that questions should
arise as to the effectiveness of our educational system . It was but
natural, too, that the millions of restless, unemployed young people
would have questions as to the value of their school experience and
that educators should reexamine not only the purpose but the tech-
niques of education . Consequently, the years that followed witnessed
a considerable number of studies and experiments relating to new
educational programs and methods . As a result much was written
and many controversies developed, although actually few far-reaching

TAX-EXEMPT FOUNDATIONS a te . 1113
changes occurred in curricula and methods in the high schools and

colleges. Ray Lyman Wilbur, a former president of Stanford Uni-
versity, once said that "Changing a curriculum is like trying to move
a cemetery ." The few school systems and colleges where considerable
changes were introduced attracted much comment and perhaps tended
to distract attention from the more persistent and extensive problems
of teacher shortages, crowded classrooms, and outmoded school facili-
ties that were products of the depression and of the war years .
It is in this setting that we must consider the role of the Rockefeller
Foundation and the General Education Board in educational change .
Except in the fields of public health, medicine, and agriculture, the
Rockefeller Foundation has not engaged in or supported educational
activities in the narrowly professional sense of that term ; its work
has been concerned chiefly with the support of advanced research
and the training of personnel for leadership in the fields of science
and scholarship . This work has inevitably served not only to increase
the body of knowledge available for educational purposes, but by its
emphasis on excellence, it has raised standards of research and teach-
ing in the United States and throughout the educational world .
In the field of public health, the work of the foundation has been
trail-blazing, both in this country and abroad . The education of
doctors and scientists for public health work has been forwarded by
liberal support of many postgraduate schools of hygiene of university
grade ; public health nurses have been trained in institutions from
Johns Hopkins and Toronto to Bangkok and Peking ; national and
local health departments in 68 countries have been strengthened with
equipment and essential services .
In. medical education in the United States, the joint efforts of the
Rockefeller Foundation and the General Education Board, with con-
tributions of over $100 million, matched many times by the generosity
of others, were to a great extent responsible for raising the teaching
of medicine in the United States from the very immature position it
occupied in 1910 to a status of excellence that today is shared with
only a few countries in the world .
A few exceptional grants by the foundation have been directly con-
cerned with educational activities . One of these was the support given
to the Commission on the Financing of Higher Education of the Asso-
ciation of American Universities ." This commission was set up by
the association to study and make recommendations about ways of
meeting the growing financial problems of our institutions of higher
education . The Institute of International Education in New York
City has received a number of grants 64 from the foundation toward
its general support . These grants were made in the belief that it is
rendering important services as a clearinghouse of information on
student-exchange programs and in helping Government agencies and
many colleges and universities to handle the complicated problems in-
volved in the administration of these programs .
Obviously none of the efforts just described has been instrumental
in changing both school and college curricula in the direction of uni-
form patterns, or in promoting a national system of education .
as A grant of $400,000 made in 1949 .
64 Grants totaling $388,350 .89 during the period 1937-53 ;, prior to 1929 other grants
had been made by the Laura Spelman Rockefeller Memorial .

In considering these charges as they relate to the General Educa-

tion Board, it should be noted that the* board has never sought to im-
pose a particular doctrine of education or to promote particular forms
of curriculum organization or courses . To be sure, the $99 million
which the board spent to support pioneering efforts in medical educa-
tion resulted in widespread changes in that field . The funds, how-
ever, were granted to strengthen established institutions and to permit
them to offer more through training to medical students .
The great bulk of the board's funds-more than $250 million-were
used for endowment, buildings and facilities, increased funds for
teachers' salaries, and help in meeting current expenses for established
institutions whose activities and traditions had long been part of the
American scene . Some were church-affiliated colleges, others were
well-known independent institutions, and some were State supported .
All were striving to set standards of educational excellence ; all had
had difficulty in providing the evermore costly type of higher educa-
tion demanded and needed by the American people . In this strength-
ening and support of traditional American education, the role of the
General Education Board was simply that of a donor of funds to insti-
tutions that had demonstrated their ability to meet the recognized edu-
cational needs of their communities and to exert leadership in the
maintenance of standards of excellence .
A small part (8 percent of the board's grants has been used, either
directly or through endowment and support of schools of education,
for study and experimentation with educational methods and pro-
cedures . No program of education can remain static and be healthy ."
There must be constant experimentation with improved methods and
study of ways to utilize new knowledge if American education is to
be adequate to its task .
The board's interest in experimentation dates back to 1917 when the
Lincoln School of Teachers College, Columbia University, was estab-
lished for the purpose of experimenting with educational procedures
and materials . The grant was made in response to a growing recogni-
tion among educators that the curricula of both the elementary and
secondary schools were no longer meeting the educational needs of
great numbers of their pupils . 56
This was the beginning of the board's activity in the science of edu-
cation. A few miscellaneous grants were made in the years that fol-
lowed, e . g., the grant to the University of Buffalo for a study of the
articulation of the college with secondary schools, grants to Antioch
and the University of Chicago for curriculum experimentation, and
the grant to the American Council on Education for the cooperative
test service which was to prepare objective tests for use at the sec-
ondary school and junior college levels . In 1933, however, following
an extensive survey of recent educational developments participated
in by 55 experts in various fields of education, the board began a phase
of its program concerned especially with the improvement of educa-
tion at the secondary school and junior college levels . During the next
61/2 years, while the major part of its funds continued to be spent on
strengthening educational institutions, on support of studies in agri-
65 "Education which is not modern shares the fate of all organic things which are kept
too long."-Alfred North Whitehead, The Aims of Education and Other Essays (New
York : The Macmillan Co ., 1929), p . 117.
d6 For a fuller discussion of this grant, see the General Education, Board's supplemental
statement, p .. 3 . 'Ibid ., p . 1141 .


cultural economics, nutrition, and forestry in the South, and on basic
studies of child growth and development, grants were also made for
studies and experiments concerned with the improvement of general
education or, as later described, with "the care and education of young
people of high school and junior college age ." 57
This program on which some $8,500,000 was spent, stimulated a
widespread interest in educational improvement . Through support of
research, it helped to build up a much-needed body of organized
psychological, physiological, and social knowledge about youth ; and
it did much to encourage a continuing consideration of problems
involved in the care and education of youth in modern society .
It did not, however, attempt to promote any specific form of reor-
ganized education or to introduce any particular ideas or materials
into the curriculum. Rather it provided opportunity for study and
deliberation by 17 national and regional organizations, 6 statewide
organizations, and 10 local educational groups ; it supported research
at 5 university schools of education, and enabled 21 colleges and uni-
versities to engage in research and experimentation of a great many
different kinds. This opportunity was still further enlarged by the
support of cooperative studies involving many schools and colleges,
each one of which was enabled to study its own particular problems
in a manner decided by its own staff and administration . Thus there
was the cooperative study of general education which involved 22 col-
leges interested in improving their general education program . There
was the 8-year study of the 30 schools, in which a group of high
schools ranging from the frankly conservative to the advanced pro-
gressive worked together to find out ways of evaluating the results of
their programs . There was also the cooperative study of teacher edu-
cation in which some 25 universities and colleges engaged in teacher
education, 25 school systems, and 10 States with programs of inservice
teacher education, pooled their experience and tried out various ways
of making teacher education more effective .
Efforts to develop new instructional materials were aided and again
these efforts included many different approaches to the problem .
Because it was quite generally admitted that new materials were
needed, particularly in the social studies and in the natural sciences,
grants were made, for instance, to Stanford University for an inquiry
into ways of improving teaching and developing new materials in
the social studies ; to the Society for Curriculum Study to enable it
to prepare a series of teaching . units on areas in American life, called
Building America ; 58 to the National Education Association and the
National Council on Social Studies for a series of teaching materials
to be prepared by a group of scholars and experienced teachers ; and to
Teachers College of Columbia University for new teaching materials
in the natural sciences . At the University of Chicago aid was given to
the establishment of a center where research materials on child growth
and development were assembled and made available to teachers of
educational psychology .
Obviously this diversified program in which so many institutions
and so many people with different points of view and different ex-
periences participated was no effort on the part of the board to slant
sa General Education Board, annual report, 1940, p . 8 .
68 For a fuller discussion of this grant, see the General Education Board's supplemental
statement, p . 8. Ibid., p . 1142 .
school and college curricula in a particular direction . Furthermore

any careful examination of these school and college curricula will
reveal not only that they continue to show the wide diversity that
is one of the strengths of our educational system, but also that they .
are more concerned with education for good citizenship than ever
before in our history and that through them all runs a common
core of loyalty to bur American way of life .
Here it may be of interest to note that the number of States which
required by law the teaching of the United States Constitution in-
creased from 5 in 1917 to 40 in 1940, and the number of States making
the teaching of United States history mandatory in the high schools
increased from 15 to 26 in the same period . 59 Our foundations do
not claim credit for this development any more than we accept
responsibility for alleged inattention to such matters .
As for the charge of promoting "a national system of education"-
if what is meant here is Federal aid for education, the answer is that
the General Education Board has itself taken no position on this
matter . There are many arguments both for and against Federal
aid to education and they have been discussed since the first bill for
Federal aid to agricultural colleges was introduced by Justin P.
Morrill in 1857. The establishment of the land-grant colleges in 1862
and the passage of the Smith-Hughes Act for Federal aid to voca-
tional education in 1917 show that the issue is not a new one . Studies
supported by our foundations on the financing of education reflect
a wide variety of views . The fact remains, however, that this country
does not have a national system of education and that control of
American education, as stated before, lies in the hands of 48 State
boards of education, thousands of college and university boards of
trustees, and 99,000 local community school boards. No prerogative
of the States has been more jealously guarded against Federal en-
croachment than their educational autonomy . The record speaks
for itself.
K . COMMUNITY SUPPORT OF EDUCATION
It has been alleged that the foundations have decreased the "depend-
ency of education upon the resources of the local community ." 60
What are the facts? In 1920 public expenditures for education in
the United States amounted to $1,151,748,000 . 61 By 1950 this had in-
creased to $7,011,768,000 . 62 In other words, the public, far from re-
linquishing its responsibility for its schools, had increased its support
of them from taxes by more than sixfold . In 1920 the total expendi-
tures of the Rockefeller Foundation and the General Education Board
were $8,959,942 or just less than eight-tenths of 1 percent of what the
public was then spending for education . In 1950 the expenditures of
both boards totaled $14,414,736, an amount equal to two-tenths of 1
percent of the funds being spent for public education .
In fact the total expenditures of some 100 philanthropic foundations
for education and a wide variety of other things have been estimated at
"s Victor Brudney, Legislative Regulation of the Social Studies in Secondary Schools,
School Law, reprinted for the National Committee for the Social Studies . (Washington,
D. C . : American Council on Education, 1941), p . 141 .
w Ibid ., n. 20 .
81 IT . S . Bureau of the Census . Statistical Abstract : 1943 . table 231, p . 218.
62 U. S. Office of Education, Biennial Survey, 1948-50, ch . I, table 9, p. 11 .
$133 million for 1950' 3 -a small sum when compared with the huge
public expenditures for education .
Obviously the contributions of the Rockefeller boards or, for that
matter, of all philanthropic foundations, were not relieving the public
of its responsibility to support education . Thus, education continues
to be paid for at an expanding rate by the local community and is con-
trolled by States and local school boards . Far from decreasing de-
pendency on the local community, the gifts of the Rockefeller boards
have served to encourage from public and private sources increased
support of needed educational services . From the beginning it has
been a policy of these boards to make grants only were there has
existed a strong institutional commitment to the work supported and
where there has been evidence of a sound base of community support
for the institution.
Among the devices used for encouraging the assumption of increas-
ing responsibility on the part of the community has been the making
of appropriations payable against matching funds raised from other
sources . The success of this device is shown by the fact that a sample
of 10 such conditional grants made by the Rockefeller Foundation,
totaling $6,025,000, shows that they encouraged $9,300 .248 in contribu-
tions from other sources for the same purposes . Similarly, 10 typical
conditional grants made by the General Education Board, totaling
$3,850,000, were in large part responsible for gifts to the recipient in-
stitutions of about $13 million .
Another device for discouraging dependency upon foundation gifts
is the tapering grant . In writing about this, Raymond B . Fosdick
says :
The proper objective of a foundation, unless created for a particularized pur-
pose, is to prime the pump, never to act as a permanent reservoir . * * * The
proportion of a budget which it provides should not be so large as to discourage
support from other sources . Its contributions should not dry up the springs of
popular giving . On the other hand, when a foundation withdraws from a project,
its withdrawal should not be so precipitate as to wreck the enterprise . A taper-
ing down of contributions over a period of years will, under ordinary circum-
stances, give an organization a chance to build up stable support from its own
natural sources."
This persisting concern for a project's ability to secure "stable sup-
port from its own natural sources" has been characteristic of the pro-
grams off both Rockefeller boards . From the beginning they have been
conscious of the importance of avoiding the assumption of obligations
that are properly a public responsibility .
At the end of a report (pt . I) furnished to this committee by its legal
analyst, she makes the extraordinary contention that the great gifts
which foundations have poured into education in this country have
involved an "encroachment on State powers" and that in order to ac-
complish this the States, or at least many of them, have been "invaded
as it were through the back door ." 65 So far as the General Education
Board is concerned, nothing could be further from the truth . Before
the committee accepts this conclusion of its legal analyst, why should
it not go to the sources, and inquire of the State departments of educa-
tion with whom the General Education Board has had cordial work-
ing relations for 50 years, whether they feel that State prerogatives
63 F, Emerson Andrews, Philanthropic Giving (New York : Russell Sage Foundation,
1950), p . 93.
64 Fosdick, The Story of the Rockefeller Foundation, pp . 294-295 .
B° Hearings, p . 709.

in the educational field have been invaded or encroached upon? If

i ace and time permitted, we could furnish innumerable pieces of evi-
nce in contradiction of this perversion of the facts, so far as the
General Education Board is concerned .
L . TRAINING FOR PUBLIC SERVICE
The research director of the committee has called its attention to
foundation grants for "trainin individuals and servicing agencies to
r ender advice to the executive branch of the Federal Government ." 66
Our two foundations have provided funds to a large number of
institutions which have trained individuals for participation in all
aspects of our national life ; Federal, State and local governments,
schools, colleges and universities, business, law, medicine, agriculture,
scientific research, the creative arts, etc .
We make no apologies for the devotion of funds to the training of
individuals for service in executive branch-or any branch-of the
Federal Government . We can imagine few better uses, or more pro-
American uses, of funds dedicated to the public interest .
M . ALLEGED INTERLOCK
Reference has been made in the testimony to an "interlock" 67 among

foundations, even to a "diabolical conspiracy ." 68 The allegation
seems to be that foundations act in concert to use their combined funds
to achieve reprehensible objectives by financial pressure and power .
We have already pointed to the well-known intimate association
between the Rockefeller Foundation and the General Education
Board, involving the same founder, a number of the same trustees and
officers, the same location, and programs which have reflected some
division of responsibility between them . This is the only "interlock"
of which we have knowledge .
Some of our trustees also serve as trustees of other institutions and
organizations, including other foundations . These were reported
fully to the Cox committee, which commented as follows in its report
to the Congress : "It is also understandable that the services of an
outstanding man should be sought by more than one foundation and
that we should therefore find a number of individuals serving on the
board of more than one foundation ." 69
The counsel of the Cox committee made the following comment
during the hearings of that committee
Mr. KEELE . The remark that Mr . Sloan made this morning leads me to make
a personal observation, which I think good taste would not have permitted had
he not made the remark . He said he did not know many of the people in founda-
tion work.
At that luncheon in New York in September, I observed with some amusement
that there was more introducing of the members of the various foundations to
one another than there was of introducing me to the members of the founda-
tions. It was quite obvious to me that there was a lack of acquaintanceship
among the philanthropoids, if we may say so ."
The overlapping of trustees between particular foundations occurs,
if at all, in the case of 1 or 2 among boards of 15 to 20 in number . If
Hearings 47 , p . 20 .
87 lbid ., p . .
Ibid ., p . 25 .
w Final report, p. 11 .
7° Hearings, p . 500 .

there is any instance of any manipulation of 2 foundations through

any such relationship, we do not know of 1 .
More than one foundation may from time to time make grants to
the same recipient institution. A glance at the public records will
show, for example, that our leading universities quite frequently re-
ceive grants in the same year from a number of foundations for a
variety of purposes . Much more rarely, two or more foundations may
make grants. to the same study, project, or purpose . Sometimes the
foundations would be in touch with each other in that situation ; at
other times their only contact would be with the applicant institution .
Applications themselves sometimes refer to the fact that a request is
being submitted simultaneously to more than one foundation .
The principal occasion for consultation among foundations, par-
ticularly among those interested in the same broad fields, arises from
the desire on the part of each one to use its funds to the best advan-
tage . Obviously, if one foundation is ready to proceed with signifi-
cant grants in a particular field, others will wish to take that into
account in their own plans . With governments and international or-
ganizations entering the field of technical assistance, an increase in
the number of foundations, and developing interest among business
corporations in philanthropic programs, any single foundation must
give increasing attention to what others are doing if it is to use its
own funds wisely . Informal discussions among foundation officers
are the typical means for exchanging such information .
It need hardly be said that such exchanges do not result in agreed
lists of preferred applicants nor in blacklists . The applicant who
finds his request rejected by a number of foundations is not entitled to
attribute his lack of success to a combination against him . On the
contrary, foundations are jealous of their freedom of action and judg-
ment, and are little concerned about whether or not another founda-
tion would have made the same decision .
One witness stated, "It is my opinion that the Rockefeller, Ford,
and Carnegie Foundations are guilty of violation of the antitrust laws
and should be prosecuted ." 71 Such a charge has no rational substance
where, as in our case, there is no monopoly, no combination, no re-
straint, and no trade.
VI. CONCLUSIONS
The committee's director of research concluded his report with the
statement
It seems incredible that the trustees of typically American fortune-created
foundations should have permitted them to be used to finance ideas and prac-
tices incompatible with the fundamental concepts of our Constitution . Yet
there seems evidence that this may have occurred."
The chairman of the committee, speaking on the floor of the House
of Representatives on July 27,1953, said
The method by which this is done seems fantastic to reasonable men, for these
Communists and Socialists seize control of fortunes left behind by capitalists
when they die, and turn these fortunes around to finance the destruction of
capitalism ."
73 Hearings, p . 212 .
7' Ibid ., p .. 51 .
73 Congressional Record', July 27, 1953, p . 10188 hearings, p . 25 .
49720-54-pt . 2-12

A full examination of the facts will remove these fears . The Cox
committee reported
It seems paradoxical that in a previous congressional investigation in 1915 the
fear most frequently expressed was that the foundations would prove the in-
struments of vested wealth, privilege, and reaction, while today the fear most
frequently expressed is that they have become the enemy of the capitalistic
system . In our opinion neither of these fears is justified ."
We believe that no evidence received by this committee warrants a
change in that opinion . Free enterprise in philanthropy has been an
extraordinary success in the United States . Governmental controls
should be introduced with the utmost caution, sows not to dam up the
stream of philanthropy. However, understanding the desire of the
Congress to protect the public interest, we offer the following sug-
gestions which we believe the committee will find constructive.
(1) Public accounting
We are convinced that tax-exempt organizations should make regu-
lar public reports about their funds and activities . Any such require-
ment should not be so burdensome as to cause an unnecessary diversion
of philanthropic funds to administrative costs . We would not, for
example, propose that smaller foundations be required to undertake
the extensive publication program of the Rockefeller Foundation and
General Education Board . The character of the essential public dis-
closure might vary within broad limits .
One of the two recommendations of the Cox committee was the
following
1 . Public accounting should be required of all foundations. This can best be
accomplished by amendment of the existing laws in substantially the form here-
with submitted as appendix A, to which we direct the attention of the 83d
Congress ."
We understand that legislation giving effect to this recommendation
was introduced in the 83d Congress by Representatives Richard M .
Simpson (Republican, Pennsylvania) and Brooks Hayes (Democrat,
Arkansas), former members of the Cox committee, but that it has
not yet been enacted . We would support legislation along such lines.
Otherwise, we see no need for new legislation . 76 Abuses can be
dealth with under existing law ; the gradual accumulation of legis-
lation affecting religious, education, and charitable activities will, we
fear, inject Government more and more into fields which are more
appropriate to private initiative and judgment .
(2) The role of the Internal Revenue Service
The . Internal Revenue Service carries a heavy burden in its duties
in connection with the granting and withholding of the tax exemp-
tions rovided by law and in reviewing the reports which are re-
quired- from tens of thousands of tax-exempt organizations . We un-
derstand from testimony that only a limited staff is available to re-
view these reports because Service personnel is ordinarily assigned
to work most likely to bring in a financial return to the Government in
increased collections of taxes due .
Reputable tax-exempt institutions are interested in having the pub-
lic protected against abuses of the tax-exemption privilege . The Con-
74 Final report, p. 10 .
7s Final report, p. 13 .
48 See colloguy between Congressman Angler L . Goodwin (Republican, Massachusetts),
and T. Coleman Andrews, Commissioner of Internal Revenue, hearings, p . 460 .


gress may wish to make it possible for the Internal Revenue Service
to make modest additions to staff for this purpose, even though such
additions would be unlikely to increase tax receipts.
(3) Congressional investigations
The role and procedures of congressional investigations are being
widely discussed by the public, and now by the Congress itself . We
believe that the experience which foundations have had with a second
investigation in 2 years might well be taken into account in such
discussion .
First, in determining that the public interest requires that an in-
vestigation be undertaken, it is suggested that the burden of such an
investigation on private citizens and organizations be fully considered .
The review of a half century of activity which has been required of
our two foundations was costly both in time and energy and in the
diversion of funds intended for philanthropy. We have no way of
estimating the cost to the colleges and universities of the country of
the replies which they were asked to make to inquiries by the com-
mittee's staff, but we have been informed that it was substantial . These
are not arguments against investigations which are deemed, on sober
judgment, to be essential . The regular committees of Congress can
readily ascertain the facts before determining whether a full investi-
gation of an entire field is called for .
Second, if it is determined that an investigation is in the public in-
terest, it is suggested that it is most important that the charges be
fully and clearly stated . The failure to frame issues in specific terms
and from the point of view of established laws and public policy cre-
ates serious difficulties . The foundations have been criticized before
a congressional committee, largely by the committee's own staff, for
actions taken by the Congress itself . The term "propaganda" has
been used by the committee's staff without apparent appreciation of its
use by the Congress and the courts with respect to tax exempt organ-
izations . Allegations cast in general terms present no ascertainable
issue on which to make reply .
Third, it is suggested that there is fundamental injustice in using
the staff members of an investigating committee in both an accusatory
and an adjudicative role .
(41) Maintenance of free enterprise in philanthropy
Since a congressional investigation carries with it implications of
governmental intervention, we urge the committee to reaffirm estab-
lished American policy in support of private initiative and enterprise
in the philanthropic field . Human needs are vast and foundation
funds are a tiny pool compared to them . Those responsible for the
use of such funds would not claim that they always find the right
answers, for each grant must, in a sense, compete with every other
possible use of the same money. But on one point foundations would
generally agree-philanthropy can flourish only in the air of freedom .
Dated August 3,1954 .
DEAN RUSK,
President, the Rocke f eller Foundation and
(eneral Education Board .

STATE OF NEW Yom,

County o f New York, ss
Dean Rusk, being duly sworn, says that he is president of the Rocke-
feller Foundation and of the General Education Board, the organiza-
tions in whose behalf the foregoing statement is made ; that the
foregoing statement is true to his knowledge except as to the matters
occurring prior to the dates (as therein set forth) of his association
with said organizations, which are therein stated to be alleged on
information and belief, and that as to those matters he believes it to
be true.
DEAN RUSK .
Sworn to before me this 3d day of August 1954.
[SEAL] HAROLD B. LEONARD,
Notary Public, State o f New York .
Term expires March 30,1955 .
APPENDIX A
Facts about the Rockefeller Foundation and General Education Board (as of Dec . 31, 1953)
The Rockefeller Foundation General Education Board Combined totals
Founded By John D . Rockefeller, 1913 By John D. Rockefeller, 1902

Organization Incorporated as charitable corporation by incorporated as charitable corporation by
special act of New York State Legislature . special act of Congress, 1903.
Purpose "To promote the well-being of mankind "The promotion of education within the
throughout the world ." United States of America, without dis-
tinction of race, sex, or creed ."
Management Board of 21 trustees, elected for 3-year term_ _ Board of trustees, not less than 9 nor more
than 17 in number, elected for 3-year term .
Program (1) Grants to institutions and agencies in (1) Grants toward support of educational
support of projects in fields of medicine institutions, agencies, and projects .
and public health, natural sciences and (2) Fellowships for individuals
agriculture, social sciences, and human-
ities .
(2) Work in public health and agriculture
conducted by foundation's own staff .
(3) Fellowships and travel grants for indi-
viduals .
Total funds received from donors (at $242,247,098 $ 145,077,357 $387,324,455 .
value when received) .
Total income collected $ 381,872,606 $ 127,094,019 $508,966,825 .
Total amount of grants $ 501,749,878 $ 317,733,124 $819,483,002 .
From principal $ 124,590,545 $ 183,028,084 $307,618,629 .
From income $ 377,159,333 $ 134,705,040 $511,864,373 .
Existing principal fund (at market $313,479,787 ---- $813,418 $314,293,205 .
Dec. 31, 1953) .
Total number of grants made 30,572 11,237 41,809 .
Average number of grants made an- 953 189 1,142.
nually (1946-53) .
Total amount of grants to recipients in $ 334,802,585 $317,733,124 $652,535,709.
United States, including administra-
tion.
Total amount of grants to recipients in $ 166,947,293 None $166,947,293.
foreign countries.
Total number of foreign countries and 80 None 80.
areas in which grants have been made .
Total number of States (United States) 48 (plus Alaska, Hawaii, Puerto Rico, and 44 and District of Columbia 48 (plus Alaska, Hawaii, Puerto Rico, and
in which grants have been made . District of Columbia) . District of Columbia) .
Totalnumber United Statesinstitutions 611 598 1,061 .
and organizations to which grants
have been made.
Facts about the Rockefeller Foundation and General Education Board (as of Dec . 31, 1953)-Continued
The Rockefeller Foundation General Education Board Combined totals
Distribution by institutions and organ- (1) University ofChicago, $14,576,044 (1) University of Chicago, $25,090,562 (1) University of Chicago, $39,666,606 .
izations in United States (10 largest (2) Harvard University, $12,363,430 (2) Vanderbilt University, $22,642,314 (2) Vanderbilt University, . $24,295,941 .
amounts) . (3) Johns Hopkins University, $12,027,871_- (3) Johns Hopkins University, $11,476,113--- (3) Johns Hopkins University, $23,503,984 .
NOTE : Donations to American Red (4) Yale University, $9,765,120 (4) Emory University, $9,381,225 (4) Yale University, $17,775,611 .
Cross and United War Work (5) National Research Council, $9,698,552___ (5) Meharry Medical College, $8,317,609 (5) Harvard University, $17,247,195 .
Fund, and Rockefeller Institute, (6) Social Science Research Council, (6) Cornell University, $8,220,966 (6) Cornell University, $10,936,769 .
General Education Board, and $9,580,990.
China Medical Board, Inc., not (7) Columbia University, $6,480,231 (7) California Institute of Technology, (7) California Institute of Technology,
taken into account . $8,082,298. $10,251,497.
(8) National Bureau of Economic Research, (8) Yale University, $8,010,491 (8) National Research Council, $10,068,112 .
$5,845,974 .
(9) American Council of Learned Societies (9) Washington University, $7,928,035 (9) Social Science Research Council,
$4,419,262. $9,823,172.
(10) Woods Bole Oceanographic Institute, (10) University of Rochester, $7,833,470 (10) Washington University, $9,735,456 .
$3,341,234.
Distribution to colleges and universities (1) Massachusetts, $15,341,901 (1) Tennessee, $45,156,651 (1) Tennessee, $47,466,541 .
by States (10 largest amounts) . (2) Illinois, $15,304,888 (2) Illinois, $28,022,677 (2) Illinois, $43,327,565 .
(3) Maryland, $12,053,132 (3) Georgia, $25 656,912 (3) New York, $35,813,066 .
(4) New York, $11,149,857 (4) New York, 424,663,209 (4) Georgia, $26,719,112.
(5) Connecticut, $9,811,230 (5) Maryland, $12,436,974 (5) Massachusetts, $26,117,128.
(6) California, $8,668,195 (6) Cali ornia, $10,943,898 (6) Maryland, $24,490,106.
(7) Iowa, $2,376 054 (7) Massachusetts,$10,775,227 (7) Cali ornia, $19,612,093 . .
(8) Tennessee 42,309,890 (8) Missouri, $9,527,479 (8) Connecticut, $18,511,464.
(9) Missouri, 12,022,529 (9) Louisiana, $9,056,974 (9) Missouri, $11,550,008 .
(10) Pennsylvania, $1,860,093 (10) Connecticut, $8,700,234 (10) Louisian8, $9,623,491 .
Total number of fellowship grants :
Direct 7,097 2,369 9,466.
Indirect 3,917 220 4,137 .
Total amount of fellowship grants :
Indirect $23,170,940 $5,016,451 $28,187,391 .
Indirect $11,811,069 $474,761 $12,285,830.


APPENDIX B
The Rockefeller Foundation-Grants to principal field of interest through
Dec. 81, 1953
Division of medicine and public health (May 22,
1913, to Dec . 31, 1953)
Investigation and control of specific diseases
and deficiencies $27,387,000
State and local health services 9,975,000
Medical care 1,041,000
Public health education 34,103,000
Medical education 91,434,000
Psychiatry, neurology, and allied subjects 20, 041, 000
Fellowships 16,454,000
Endocrinology 2,248,000
Other public health and medical subjects 10, 012, 000
Field staff 25,910,000
1 $238,605,000
Division of natural sciences and agriculture (May 22,
1913, to Dec . 31,1953)
Experimental biology 25, 928, 000
Physics, mathematics, and other nonbiological
sciences 8,630,000
Astronomy 1,462,000
Agriculture 5,854,000
General support of science 1,057,000
Other special projects 1,609,000
Fellowships
Direct $3,134,000
Indirect 4,519,000
7,653,000
Grants in aid (since 1944) 2,850,000
1 55, 043, 000
Division of social sciences (Jan . 1, 1929, to Dec. 31,
1953)
General social science including fellowships and
research aid 15,932,900
Economics 14,205,575
International relations 9,896,957
Institutional centers for research and advanced
training 5,693,975
Public administration 7,716,475
Community organization 2,600,400
Group relations 2,390,320
Development of social sciences in Europe 2,336,030
Other, including cultural anthropology, popula-
tion, ethics, etc 6,027,025
Unpaid balances of Laura Spelman Rockefeller
Memorial appropriations as of Dec . 31, 1928,
transferred to the Rockefeller Foundation____ 12, 283, 193
1 79, 082, 850
I These totals represent gross appropriations ; actual expenditures are slightly less .
The Rockefeller Foundation-Grants to prinipal field of interest through

Dec. 31, 1953-Continued
Division of the humanities (Jan . 1, 1929, to Dec . 31,1953)
Scholarship and the arts
History $1,046,653
Philosophy 507,857
Language, logic, and symbolism 1,053,804
General education 345,875
General purposes 5,514,927
Literature 1,129,001
The arts 2,883,978
$12,482,095
Intercultural understanding
General 307,865
European studies 68,020
American studies 1,950,151
Near Eastern studies 811,944
Slavic studies 1,287,718
South and Southeast Asian studies 468,040
Far Eastern studies 2,231,689
Latin American studies 902,929
African studies 90,900
8,119,256
Other interests
Film and radio 1,420,776
Communication research 552,870
Library service 4,962,207
Archaeology 4,759,716
11, 695, 569
1 32, 296, 920
1 These totals represent gross appropriations ; actual expenditures are slightly less.


APPENDIX C
The Rockefeller Foundation-Board of trustees, July 1, 1954
Name I and address Terms of service
Bowles, Chester Former Governor of Connecticut and Apr . 7, 1954, to Apr . 6, 1955.
former United States Ambassador to
India and Nepal, Essex, Conn .
Bronk, Detlev W President, the Rockefeller Institute for Apr . 1, 1953, to Apr . 6, 1955 .
Medical Research, York Ave. and 66th
St., New York, N . Y.
Claflin, William H., Jr President, Soledad Sugar Co ., room 1006, Apr . 5, 1950, to Apr . 6, 1955 .
75 Federal St ., Boston, Mass .
Dickey, John S President, Dartmouth College, Hanover, Apr . 2, 1947, to Apr. 4, 1956 .
N. H.
Douglas, Lewis W Chairman of the board, Mutual Life Apr . 10, 1935, to Apr . 2, 1947 ;
Insurance Co . of New York, 1740 Broad- Dec . 6,1950, to Apr . 6,1955 .
way, New York, N . Y., former Ambas-
sador to Great Britain.
Harrison, Wallace K Harrison & Abramovitz, architects, 630 July 1, 1951, to Apr . 4,1956 .
5th Ave., New York, N . Y.
Kimberly, John R .. President, Kimberly-Clark Corp ., Neenah, Apr. 1, 1953, to Apr . 3, 1957.
Wis .
Loeb, Robert F Bard professor of medicine, Columbia Apr . 2, 1947, to Apr . 3, 1957.
University, 620 West 168th St ., New
York, N . Y.
Lovett, Robert A Brown Bros ., Harriman & Co ., 59 Wall May 20, 1949, to Apr . 3, 1957 .
St ., New York, N. Y ., former Secretary
of Defense .
McCloy, John J Chairman of the board, the Chase Na- Apr . 3, 1946, to June 11, 1949 ;
tional Bank of the City of New York, Apr . 1, 1953, to Apr. 6,1955.
18 Pine St., New York, N . Y ., former
High Commissioner for Germany .
Moe, Henry Allen Secretary general, John Simon Guggen- Apr. 5, 1944, to Apr . 4, 1956.
heim Memorial Foundation, 551 5th
Ave ., New York, N. Y .
Myers. William I Dean, New York State College of Agri- Apr . 2, 1941, to Apr . 4, 1956.
culture, Cornell University, Ithaca,
N. Y .
Parran, Thomas Dean, Graduate School of Public Health, Apr. 2, 1941, to Apr. 4, 1956 .
University of Pittsburgh, Pittsburgh,
Pa .
Rockefeller, John D ., 3d Business and Philanthropy, 30 Rockefeller Dec. 16, 1931, to Apr . 4, 1946.
Plaza, New York, N . Y .
Rusk, Dean President, the Rockefeller Foundation Apr. 5, 1950, to Apr. 3, 1957 .
and the General Education Board, 49
West 49th St ., New York, N . Y ., former
Assistant Secretary of State .
Smith, Geoffrey S President, Girard Trust Corn Exchange Apr !5, 1950, to Apr. 6, 1955 .
Bank, Broad and Chestnut Sts ., Phila-
delphia, Pa.
Sproul, Robert G-- . President, University of California, Apr. 3, 1940, to Apr. 6, 1955.
Berkeley, Calif .
Sulzberger, Arthur Hays Publisher, the New York Times, and Apr . 5, 1939, to Apr. 3, 1957.
resident and director, the New York
Mmes Co., 229 West 43d St ., New York,
N. Y.
Van Dusen, Henry P President, Union Theological Seminary, Apr . 2, 1947, to Apr . 3, 1957.
Broadway and 120th St ., New York,
N. Y.
Wood, W . Barry, Jr Professor of medicine, School of Medicine, July 1, 1954, to Apr . 3, 1957 .
Washington University, St . Louis, Mo .
1 128 TAX-EXEMPT FOUNDATIONS
General Education Board-Board of trustees, July 1, 1954

Name Position and address Terms of service
Branscomb, Bennett Harvie__ Chancellor, Vanderbilt University, Nash- Apr. 3, 1947, to Apr. 4, 1957.
ville, Tenn .
Brook, Detlev W President, the Rockefeller Institute for Apr . 8, 1954, to Apr. 5, 1956.
Medical Research, 66th St . and York
Ave ., New York, N. Y .
Coolidge, T . Jefferson Chairman of Board, United Fruit Co., and Apr. 6, 1950, to Apr. 4, 1957 .
Old Colony Trust Co ., 80 Federal St .,
Boston, Mass .
DeVane, William C Dean, Yale College, Yale University, New Apr. 6, 1950, to Apr . 7, 1955 .
Haven, Conn .
Douglas, Lewis W Chairman of board, Mutual Life Insur- Apr. 8, 1937, to Apr . 3, 1947;
ance Co. of New York, 1740 Broadway, Dec . 7, 1950, to Apr . 7, 1955 .
New York, N. Y., former Ambassador
to Great Britain.
Myers, William I Dean, New York State College of Agricul- Apr. 3,1941, to Apr . 7, 1955 .
ture, Cornell University, Ithaca, N . Y.
Norton, Edward L Chairman of board, Voice of Alabama, Apr. 6, 1944, to Apr . 5, 1956 .
(WAPI, WAFM-TV), 701 Protective
Life Bldg ., Birmingham, Ala .
Parran, Thomas Dean, Graduate School of Public Health, Apr. 3, 1947, to Apr . 5, 1956 .
University of Pittsburgh, Pittsburgh,
Pa .
Rockefeller, John D ., 3d Business and Philanthropy, 30 Rocke- Jan . 1, 1932, to Apr. 5, 1956 .
feller Plaza, New York, N . Y .
Rusk, Dean President, General Education Board and Dec . 6, 1951, to Apr . 7, 1955 .
the Rockefeller Foundation, 49 West
49th St ., New York, N . Y., former
Assistant Secretary of State .
Sproul, Robert G .___ President, University of California, Apr . 4, 1940, to Apr . 4, 1957 .
Berkeley, Calif.
Van Dusen, Henry P__._ . President, Union Theological Seminary, Apr . 8, 1948, to Apr . 4, 1957.
Broadway and 120th St ., New York,
N . Y.
SUPPLEMENTAL STATEMENT IN BEHALF OF THE ROCKEFELLER

FOUNDATION, BY DEAN RUSK, PRESIDENT
The Rockefeller Foundation submits this supplemental statement
to the Special Committee To Investigate Tax-Exempt Foundations
of the 83d Congress . Its supplements the joint principal statement
by the Rockefeller Foundation and General Education Board of the
same date and contains the foundation's comments upon certain spe-
cific grants which were referred to in the public hearings on com-
mittee staff reports.
This statement is verified under oath . Attention is invited to the
second paragraph on page 1 of the principal statement, regarding
the president's personal knowledge and statements made upon in-
formation and belief.
AMERICAN COUNCIL OF LEARNED SOCIETIES
The American Council of Learned Societies has been mentioned in

the testimony as an intermediate organization 1 to which authority
(in this instance in the field of the humanities) is delegated by the
foundations, and the danger of the concentration of power in the hands
of such an organization has been stressed.2 These observations do
not conform to the facts .
The American Council of Learned Societies is a federation of 25
national organizations devoted to the encouragement of humanistic
studies. These organizations are recognized learned societies of the
1 Hearings, p. 601, 602.
P Hearings, pp. 469, 601, 612 .
TAX-EXEMPT FOUNDATIONS 1 12 9
United States and represent a combined membership of nearly 50,000
American scholars in these fields . The central function of the coun-
cil is the encouragement of humanistic studies . In serving this cen-
tral function, the activities of the council include : (1) the initiation
and promotion of research, (2) the dissemination and utilization of
the results of research, (3) the training of individuals for research
and teaching, (4) the representation at home and abroad of American
scholarship in the humanities.
It is our understanding that the American Council of Learned So-
cieties has filed a statement with the committee . This statement will
undoubtedly provide ample information of the policies, organization,
and program of the council. Our comment here is therefore limited
to the relation of the council to the work of the Rockefeller Foundation .
The American Council of Learned Societies receives funds from a
variety of sources for various phases of its work. While substantial
grants ($4,788,775) have been made by the Rockefeller Foundation
toward general support and for specific projects of the council during
a period of more than 20 years, these grants represent slightly less
than 15 percent of the funds appropriated by the foundation for work
in the humanities . This foundation plays no part in determination
of council policies and exercises no authority in the appointment of
the councils staff or committees, and in no sense does it delegate re-
sponsibility to the council for the conduct of its program in the
humanities. Aside from the funds contributed for the general sup-
port of the council, appropriations have been made for specific proj-
ects which the council was especially well qualified to carry out and
for which it had submitted carefully prepared proposals . Such special
projects have been directed, in most cases, by committees representative
of American scholarship in the particular academic fields involved .
These committees also assume responsibility for the selection of re-
cipients of fellowships and grants-in-aid awarded by the council .
The foundation's support has been given to the American Council
of Learned Societies in the belief that the organization was playing
an important role in the advancement of American scholarship . This
role was was well stated by Dr . Charles E . Odegaard, former execu-
tive director of the council and now dean of the College of Literature,
Science and the Arts, University of Michigan, in his 1950 annual
report :
* * * the learned scientific societies based on disciplines or fields of in-
terest * * * have attained national representation in their membership . Use-
ful as these are-and no one could deny their significance-there remains a
place for something more, for an association supplementary to colleges and
universities, academies, and learned societies . Historically, it is the research
councils which, within the limits of their slender resources, have tried to fill
this supplementary niche . It is our present duty in this council to see as clearly
as possible the needs which are not met by other agencies and to set in motion
efforts to meet these additional needs by whatever means can be found .
The contribution which the American Council of Learned Societies
has made to American culture is evident from the most casual review
of that organization's history . Its reliability is attested by the fact
that in 1951 the Office of Naval Research, acting on behalf of the three
defense departments, signed a contract with the council for the
preparation of a national register of humanists and social scientists .
COLUMBIA UNIVERSITY-RUSSIAN INS111U1E
The report of the committee's Legal Analyst, part II, refers to

foundation support of studies carried on by the Russian Institute of
Columbia University, studies which the Legal Analyst characterizes,
along with others, as "aimed at the single target of world peace ." 3
The quoted phrase is taken by the Legal Analyst from Fosdick's The
Story of the Rockefeller Foundation, p . 219 . Mr. Fosdick's state-
ment was : "There is a sense, of course, in which the foundation's en-
tire work in all fields has been aimed at the single target of world
peace ." Whether the expression is given the broad meaning in which
it was used by Mr . Fosdick, or a narrower and more specific mean .
ing, it is fairly applicable to the foundation's grants for support of
Columbia University's Russian Institute.
This report of the Legal Analyst was presented after the commit-
tee had cut off public hearings . As a result, we do not have the bene-
fit of any oral testimony by the Legal Analyst, explaining why these
grants were thought to be relevant in the committee's search for error
on the part of the foundations .
The Rockefeller Foundation takes modest pride in having given
substantial aid toward the Russian Institute, which has become one
of the major centers for Russian studies in this country . Knowledge
of our powerful and unscrupulous rival is the cornerstone of our de-
fense against communism . It is the business of the Russian Institute
to supply such knowledge in all its phases . It has provided more
trained specialists in the Russian field than any other center in the
country . During the last 7 years, the State Department, the Army,
the Air Force and the Navy have sent 99 persons to the institute for
training. Of the persons who have completed the institute's pro-
gram, nearly all are making active use of their training in Govern-
ment service, Government-supported research projects, teaching,
journalism and similar useful occupations .
The importance of affording opportunity for study in the Russian
field was well expressed by President Eisenhower 'in his inaugural
address as president of Columbia University, when he said
There will be no administrative suppression or distortion of any subject that
merits a place in this university's curricula. The facts of communism, for ex-
ample, shall be taught here-its ideological development, its political methods,
its economic effects, its probable course in the future . The truth about com-
munism is, today, an indispensable requirement if the true values of our demo-
cratic system are to be properly assessed . Ignorance of communism, fascism,
or any other police-state philosophy is far more dangerous than ignorance of
the most virulent disease.4
Before the committee itself condemns foundation support of an
institution which is playing such a vital role in our defense against
communism, we respectfully suggest consultation with those who are
responsible in executive capacities for the conduct of our foreign
affairs and for the defense of the country .
CORNELL CIVIL LIBERTIES STUDIES
The report of the committee's Legal Analyst, part II, is critical of

the foundation's grants to Cornell University in support of these
studies on the ground that they were under the direction of "two indi-
3 Report of Legal Analyst, hearings p . 893 .
4 The New York Times, Oct . 18, 194k, p . 21 .
viduals" who were not "sufficiently impartial to insure a'factual exam-
ination' or an òbjective finding.' " 5 These two individuals, Dr .
Robert E . Cushman, chairman of the department of government at
Cornell, and Prof. Walter Gellhorn of the Law School, Columbia Uni-
versity, are then discussed under the heading "The sponsorship of
individuals who by their writings are of a Socialist, if not Communist
philosophy, dedicated to the idea of world government ." 6
We will not discuss these charges at length since the president of
the Rockefeller Foundation, Mr . Dean Rusk, testified fully before the
Cox committee, and was cross-examined, on the grants to Cornell for
the civil liberties studies .7 If he were given the opportunity to testify
before this committee, he would not testify differently . We also wish .
to direct the attention of this committee to the testimony and cross-
examination of Professor Gellhorn, who appeared before the Cox
committee at his own request and denied under oath past or present
membership in or sympathy with the Communist Party ."
In 1948, the Rockefeller Foundation made a grant of $110,000 to
Cornell University for a study of the relation of civil rights to the
control of subversive activities . To permit completion of this work,
three additional grants were made, $20,000 in 1950, $6,000 in .1951, and
$3,500 in 1952 . The director of the survey was Dr. Robert E. Cush-
man, chairman of the department of government at Cornell and form-
erly president (1943) of the American Political Science Association.
Dr . Cushman chose his own associates, although foundation officers
knew who the major ones (including Professor Gellhorn) were to be
before the first grant was made .
This was not the first time that the foundation had concerned itself
with the question of civil liberties . In 1944 and 1947 grants totaling
$28,000 had been made to Cornell for a study of civil liberties in war-
time, headed also by Dr . Cushman . This wartime study embraced
questions relating to the civil rights of enemy aliens, of conscientious
objectors, and of civilians under martial law .
Dr. Cushman, director of the program, was experienced in the field
of civil liberties and had (and still has) a reputation for scholarly
competence and objectivity . He had been head of the department of
government in one of the country's leading universities . The founda-
tion knew that he intended to associate with him in these studies Prof .
Robert Carr, department of government, Dartmouth College, formerly
executive secretary of the President's Committee on Civil Rights ;
Miss Eleanor Bontecou, formerly an attorney with the Department of
Justice and later in the War Department ; and Professor Gellhorn of
Columbia .
Professor Gellhorn was a well-known and distinguished professor
in one of the country's leading law schools, whose colleagues held (and
still hold) him in high regard, and who had been Director of the At-
torney General's Committee on Administrative Procedure in 1939-41 .
The results of the research supported by the foundation have not
caused us to change our view of Dr . Cushman or his associates, includ-
ing Professor Gellhorn .
Published reviews of the studies show that they have been widely
regarded as scholarly and objective and as constituting a valuable
5 Report of Legal Analyst, hearings, p . 900.
e Ibid .
' Cox committee hearings, p . 514 8.
e Cox committee hearings, p . 734 8.
1 13 2 TAX-EXEMPT FOUNDATIONS
source of information on the issues involved in attaining the two im-

portant objectives of national security and civil liberty . The follow-
ing studies have been published
Security, Loyalty and Science, by Walter Gellhorn, Columbia University Law
School
The Tenney Committee, 9 by Edward L . Barrett, Jr ., University of California
Law School
Un-American Activities in the State of Washington, 9 by Verne Countryman,
Yale Law School
Loyalty and Legislative Action,9 by Lawrence H . Chamberlain, Columbia Uni-
versity Law School
The States and Subversion, 10 partly written and partly edited by Walter
Gellhorn
The House Committee on Un-American Activities, by Robert K . Carr, Dart-
mouth College
The Federal Loyalty-Security Program, by Miss Eleanor Bontecou
A summary volume bringing together the conclusions as a whole is
being prepared by Dr . Cushman, and is scheduled for publication in
1954 .
These studies, involving as they do a controversial subject, have
been criticized by some commentators . But a much more widely held
opinion is that they are useful and valuable . Unfortunately, there
are some persons who would view as subversive any criticism of any
phase of the executive loyalty program or of any activity of legis-
lative committees interested in the problem . But the American tra-
dition of concern about individual liberty is older than the Republic,
as reflected, for example, in the Declaration of Independence . One
of the first acts of the first Congress was to propose 12 amendments to
the States, of which the States accepted 10, which made secure against
Federal encroachment the right of individuals in respect of religion
freedom of speech, military service, and the use and maintenance of
armies, search warrants, trial in accordance with fixed law and by
judgment of juries, criminal accusation, the inflictment of punish-
ment and the exaction of bail . Stories in the press indicate that many
Members of Congress from both parties are now concerned about-
procedures followed by congressional investigating committees, and .
that new codes of procedure are under consideration .
We are sure that the proper concern for individual liberty in the
American tradition evidenced by the studies of Dr . Cushman and
Professor Gellhorn will not be considered an indication of Com-
munist or Socialist sympathies .
COUNCIL ON FOREIGN RELATIONS
The Council on Foreign Relations, which has received substantial

support from the Rockefeller Foundation, is one of the organizations
criticized in the report of the committee's Legal Analyst, part II,11 as
biased in favor of an "internationalist" viewpoint, and as maintain-
ing close relations with government .
The council is without doubt one of the principal nongovernmental
agenci es devoted to a study of our foreign affairs. In this field it has
9 Condensations of these three volumes also appear as chapters in the States and Sub-
version .
10 Chapters for this volume were also prepared by E . Houston Harsha, University of
Chicago Law School, on the State of Illinois ; by William B . Prendergast, assistant pro-
fessor of political science, U. S . Naval Academy, on the Ober Act of the State of Maryland ;
and by Robert J . Mowitz, department of government, Wayne University, on the city of
Detroit .
11 Report of Legal Analyst, hearings, p . 884 .

a distinguished record of service to the public and to the United States
Government . Perhaps its major service, undertaken shortly after the
outbreak of World War II, developed into the program of war and
peace studies which the Legal Analyst seems to regard as in some
way suspect. The fact is that it was these studies to which Secretary
of State Cordell Hull referred in saying : "I hope you will go on with
this important work and that you will continue to give us the benefit
of research and thinking done under the council's auspices."
On pages 33 and 34 of the report the Legal Analyst sets forth the
names of research secretaries of the war and peace studies who "pro-
gressed to other work related to the organization of peace and the
settlement of postwar problems. * * *" The intimation seems to
be that there was something sinister and evil in this relationship .
We cannot believe that the Congress will view with alarm our sup-
port of the Council on Foreign Relations, or will share the strange
viewpoint of the legal analyst that the public service of a grant re-
cipient is a ground for criticism of the foundation responsible for
the grant.
THE FOREIGN POLICY ASSOCIATION
The report of the committee's legal analyst, part II, devotes con-
siderable attention 12 to the Foreign Policy Association, to which from
1933 to 1950 the Rockefeller Foundation has made substantial grants,
largely for the support its its research and educational programs .
The report finds the Foreign Policy Association guilty of an "inter-
nationalist trend," 13 said to be exemplified in certain of its Headline
Books, and claims that, "in those reviewed little attention was paid
to the possibility of a nationalist point of view as opposed to an
internationalist one." 14
The facts are that the Foreign Policy Association during the period
covered by the foundation's grants has been one of the leading or-
ganizations in the country devoted to research and study in problems
of international relations . Its series of Headline Books has now
reached 104 titles . The legal analyst comments adversely on 4. The
authors of others include James B . Conant, former president of
Harvard University ; Grayson Kirk, now president of Columbia
University ; Allen W. Dulles, now Director of the Central Intelligence
Agency ; and other well-known students of foreign affairs . The Rock-
efeller Foundation cannot claim the credit for these selections, nor it
it responsible for those which have been criticized . For the reasons set
forth in our principal statement, we do not censor publications result-
ing from our grants or control the product of research which we
support.
We express full confidence in the Foreign Policy Association as an
agency for public education in problems of international relations,
which has become so vital since the leadership of the free world has
been thrust upon the United States .
INSTITUTE OF INTERNATIONAL EDUCATION
A witness has implied that the foundation's funds were used for a
summer school in Moscow at which American educators were indoc-
12Reporto f Legal Analyst, hearings, p .. 882 ..
13Report of Legal Analyst, hearings, p . 884 .
PReport of Legal Analyst, hearings, p . 883„
1,134 TAX-EXEMPT FOUNDATIONS
trinated with communism .'5 Although the testimony is confused as

to the exact title of the agency supposed to have sponsored the criti-
cized summer school, it probably refers to the Institute of Interna-
tional Education . This organization, which is located in New York
City, operates a program concerned with facilitating international
student-exchange programs. It renders valuable services to colleges,
universities, and . Government agencies in the administration of fel-
lowships and scholarships for foreign students and for American stu-
dents oing abroad . Its support comes largely from grants from a
number_ of foundations and from Government contracts which amount
to almost one-half of its annual budget.
The Rockefeller Foundation has made grants totaling $396,505
toward the general support of the institute . Prior to 1929, grants
were made by the Laura Spelman Rockefeller Memorial chiefly to
enable the institute to maintain a travel and information service for
American professors and students in France and Great Britain .
Our records do not show that the Rockefeller Foundation appro-
priated funds for the support of a summer school in Soviet Russia .
We have been told that there was a summer school for foreign students
in Russia in 1933 with which the institute had no relation ; it seems
that this summer school was repeated in 1934, with some sponsorship
by the Institute of International Education, which had long served
as the principal American contact for summer schools in foreign coun-
tries . In 1935, plans for repetition were frustrated by administrative
inefficiency and lack of cooperation on the Russian side and the pro-
gram for that year was canceled . We know of no resumption .
To the extent that the Rockefeller Foundation had contributed to
the general support of the Institute of International Education, some
portion of its funds can be said to have been involved in the sponsor-
ship of the 1934 school, referred to above . Against the background
of Russian war relief and business and commercial exchanges of the
1920's, diplomatic exchange beginning in 1933, and the official Ameri-
can policy of encouraging exchanges through the Iron Curtain until
as late as 1947, we see no significance in the fact that some of our funds
might have been used for such a purpose in 1934 .
INSTITUTE OF PACIFIC RELATIONS
Two specific questions in regard to the Rockefeller Foundation's
support of the Institute of Pacific Relations have been raised by wit-
nesses before this committee . Both points had been covered in the
full, detailed statement on this subject made by the foundation's presi-
dent before the Cox committee in 1952, but in the discussions before
this committee neither counsel nor witnesses made any reference to
that previous testimony . It should not be necessary to repeat the en-
tire statement here . We respectfully urge, however, that before
undertaking to criticize the foundation for these grants, this commit-
tee should familiarize itself with the facts by a careful review of our
statement, which appears in the printed report of the hearings of the
C ox committee, pages 520 to 528 . This present statement will be lim-
ited to a discussion of the two matters mentioned by the committee's
witnesses, with the addition of such background as seems necessary .
25 hearings, pp. 267-283 .


The first question relates to the charges made 'against the IPR by
Alfred Kohlberg . It was testified by one witness, Dr . Kenneth Cole-
grove, that what he couldn't understand "* * * was when Alfred
Kohlberg was able to get the consent of one of the very high officers
in the Rockefeller Foundation, why the foundation would not make
an investigation of the IPR." 16
At a later point in his testimony the following exchange occurred
The CHAIRMAN. To whom was Kohlberg's request for an investigation made,
Professor?
Dr . CoLEORovE . It was made to Fred Willetts, an official of the Rockefeller
Foundation, one of the outstanding men, a man of great integrity and a man of
competence and scholarship . I have great respect for Fred Willetts, and he
must have had a good reason for not investigating . But that reason, it seems to
me, ought to be told to the American people."
The actual facts in regard to this episode, which differ materially
from Dr. Colegrove's version, were set forth in the public testimony
of the president of the Rockefeller Foundation before the Cox com-
mittee, as follows
In 1944 Alfred Kohlberg sent the foundation copies of his charges of pro-
Communist bias in the IPR . The director of the social-sciences division of the
foundation suggested that the charges be referred to an independent body of
competent persons for hearing and determination . This proposal was accepted
by Mr. Kohlberg, but rejected by the _IPR . Instead, a special committee of IPR
trustees reported to its board that the executive committee and responsible of-
ficers of the American council had "investigated Mr . Kohlberg's charges and
found them inaccurate and irresponsible ." The foundation officers would have
preferred an independent appraisal of the organization's activities, I might say,
not because of any views which they then held on the merits of the problem but
because in their view at the time that was the proper procedure by which you
could get rid of this kind of issue one way or the other."
The "director of the social-sciences division of the foundation" re-
ferred to in this quotation was Joseph H . Willits, who is evidently the
person Dr. Colegrove had in mind . As the foregoing testimony shows,
there was no plan to have the foundation conduct a public investigation
of the IPR, an undertaking for which the foundation was neither
equipped nor qualified. Mr. Willits never gave his consent to have
such an investigation undertaken by the foundation, and there was no
mysterious suppression of such a proposal . On the contrary, Mr .
Willits intervened with a suggestion for quite a different type of in-
vestigation which was never carried out because the proposal was not
acceptable to the IPR.
The second question was raised by the testimony of Dr. David N .
Rowe . It related to his understanding "that the Rockefeller Founda-
tion was still contributing money to the IPR after 1950" when, in his
opinion, grants should have been terminated . 19 Before turning to the
facts in that regard, we call attention to the following point which the
chairman of the committee developed in questioning this witness
The CHAIRMAN . I am not sure about the year, but on up until the late forties,
the IPR had an excellent standing ; did it not? I am not sure what year it was,
but perhaps up to the midforties .
Dr . Rows . The IPR had excellent standing in educational circles, in govern-
mental circles, and intellectual circles up until the late forties . That is an
accurate statement"
is Cox committee hearings, p . 524 .
"Hearings: p. 541 .
,49720-54-pt . 2-13
This witness testified that he had joined the IPR around 1939, 21 had
accepted election as one of 'its trustees in 1947, and had continued to
serve as a trustee until 1950,22 when he resigned with a letter which he
now feels "was probably altogether too polite ." 23 He also testified in
regard to the IPR that
They were known all over the country as the outstanding center in the United
States for Far Eastern research and study"
The bulk of the foundation's grants to the IPR was made during a
period even earlier than Dr. Rowe's trusteeship, when its prestige was
fully as high as he relates.
The foundation's last appropriation for the IPR was made in 1950,
payable over 2 years. The circumstances under which this action was
taken were fully described in the Cox committee testimony . 25 A
highly responsible group, under the chairmanship of Gerard Swope,
former president of the General Electric Co ., was undertaking to sal-
vage the great values in the IPR program to which Dr . Rowe testified.
The foundation officers made a full examination of the problem, within
the means proper to an organization like ours . As the committee
knows, the FBI and other Government security agencies give informa-
tion only to Government departments . Four IPR trustees, who had
earlier resigned because of dissatisfaction with the situation, had
shortly after their resignations urged the foundation to continue its
support in order to reinforce the efforts of those who were working to
strengthen the organization . Confronted with the strongest recom-
mendations for continuing support, and with no contrary advice from
the agencies of Government responsible for security problems, the
foundation approved the 1950 grant.
Dr . Rowe's view that the 1950 grant should not have ben made seems
to rest largely on hindsight, based principally on evidence brought out
in the McCarran committee hearings, which did not begin until nearly
a year after the making of the grant .
These hearings obviously prompted the following statement in the
report of the committee's legal analyst, part II
The Institute of Pacific Relations has been the subject of exhaustive hearings
by other congressional committees in which its subversive character has been
thoroughly demonstrated?"
The only exhaustive hearings on this organization known to us are
those of the McCarran committee whose report was published in 1952 .
The foundation does not feel called upon to comment on the 1e gal
analyst's statement other than to observe that editorial comment on the-
McCarran committee's report was sharply divided, that the IPR has
not been listed by the Attorney General as a subversive organization,
and that it has not been deprived of its tax-exemption privilege by the
Internal Revenue Service, a privilege which it would hardly be
allowed to retain if the Internal Revenue Service agreed with the com-
mittee's legal analyst that the IPR's "subversive character has been
thoroughly demonstrated ."
Y1 Hearings, p . 537 .
22
Hearings, p. 537 .
2324 Hearings, p . 539 .
Hearings, p. 541 .
25 Cox committee hearings, p . 526 8.
26 Report of legal analyst, hearings, p . 897 .

THE KINSEY STUDIES
It is not clear from the transcript of proceedings whether or not

the committee wishes us to comment upon the foundation's grants for
sex, research, including its support for the Kinsey group at the Uni
versity of Indiana . At one point, however, the Chairman states :
* * * As one member of the committee, I don't have much interest in the
Kinsey report . Any interest that the committee might have in the Kinsey report
arises out of whether that was a desirable undertaking for a foundation, which
is quite a different matter * * *''
We wish to make the foundation's position clear, even though com-
mittee members have expressed a number of reservations about getting
into the matter .
In 1931 the Rockefeller Foundation became interested in systematic
support for studies in sexual physiology and behavior . This came
at a time when the foundation began to concentrate its natural science
interest more in the life sciences and less in the physical sciences .
The latter decision, a very natural one in view of the foundation's
long and large interest in medicine and public health, was primarily
based on the conviction that the physical sciences had received large
support and were far advanced ; whereas there were great undeveloped
opportunities in the life sciences to serve the welfare of mankind .
Support for studies in reproductive physiology and behavior consti-
tuted an obviously necessary part of this program since the ability to
reproduce is one of the elementary characteristics of living organisms .
The Rockefeller Foundation began in 1931 to make modest grants
to the committee for research in problems of sex of the National Re-
search Council (hereinafter referred to as the NRC committee), sup-
port for which had previously come from the Bureau of Social
Hygiene. Foundation grants to this committee have been the
following
1931 $150,000 1941 $150,000
1932 75,000 1944 . 135,000
1933 65,000 1946 120,000
1934 80,000 1946 . 80,000
1935 75,000 1949 240,000
1936 75,000 1951 . 160,000
1937 200,000 19 4 . 150,000
The NRC Committee, first organized in 1921, has published a sum-
mary account of its first quarter century in a volume Twenty-Five
Years of Sex Research '28 which we have supplied to your research
director. A reading of it will suggest, we believe, two conclusions .
First, the NRC Committee has been made up over the years of a
group of our most eminent scientists in biology and medicine . Sec-
ond, it has achieved an extraordinary record in opening up and de-
veloping an entire field of medical physiology .
For example, the three decades during which this program has now
been in operation have seen a most encouraging growth in our knowl-
edge of the reproductive process and in the ability of modern medicine
to control its disorders and diseases . Many of the most significant
advances have stemmed from the work of the NRC Committee and
"?28 Transcript, p. 1854 .
25 Years of Sex Research, Aberle, S . D. and Corner, G. W. . W. B . Saunders Co .
(Philadelphia, 1953) .
the closely related grants made directly by the foundation . Examples

may be cited as follows : (1) The isolation and later synthesis of
estrogen, the first ovarian hormone to be discovered ; this important
substance is now widely and safely used to relieve menopausal dis-
tress and discomfort and in the treatment of disordered menstrua-
tion, sterility, and retarded genital development in girls ; (2) a similar
identification of the testis hormone, androgen, which is similarly use-
ful in the treatment of disordered physiology in the male ; (3) recog-
nition of several different substances from the anterior pituitary
glands which are involved in body growth, sugar metabolism, milk
secretion, and various disorders which apparently result from unusual
stress .
Less completely attributable to the work of the NRC Committee
but still importantly influenced by it was the discovery of hormones
of the adrenal cortex . Increased knowledge of the interactions of
the foregoing hormones in determining the normal physiology of the
reproductive cycle has led to far more intelligent handling of women's
diseases, problems of sterility, and the commercial breeding of fur-
bearing and food-producing animals . Two notable achievements in
the field of cancer have resulted from NRC Committee support : the
diagnosis of cancer of the uterus by study of the cells of the vagina
and the treatment of cancer of the prostate gland by the use of
hormones .
Beginning about 1941, the NRC Committee became interested in the
work of Dr . Alfred C . Kinsey and others at the University of Indiana
in the field of human sexual behavior ; between 1941 and 1946 the NRC
Committee had allocated to this work $120,100 of the total funds avail-
able to it. Beginning in 1946, the NRC Committee and the foundation
discussed the needs of the Indiana study more specifically, and it was
agreed that the 1946 foundation grant to the committee was to be al-
located to Dr. Kinsey's group. Similarly, it was understood that the
NRC Committee would allocate up to 50 percent of the grants of 1949
and 1952 for the same purpose . In addition, the foundation made one
grant of $14,000 direct to the University of Indiana for Dr . Kinsey's
Institute of Sex Research .
Among the published materials issuing from the Indiana group
are the widely discussed volumes Sexual Behavior in the Human Male
and Sexual Behavior in the Human Female . The aim of the studies
was to contribute to the better understanding of some of the elements
in a complex aspect of human behavior in which parents, doctors, min-
isters, teachers, legislators, social workers, penologists, and many
others have a serious interest .
A thoughtful reader will understand why these books have evoked
the greatest variety of both professional and popular interest, ranging
from highest praise to violent condemnation . They dealt with an
aspect of behavior about which comparatively little is known ; to the
extent that they pointed to a possible signicant disparity between
acknowledged mores and actual behavior, they touched upon sensitive
issues. They involved complex problems of statistics and procedure,
discussed at length on pages 3-97 of the second of the two volumes and
by other authors in many articles elsewhere . The two studies dealt
almost entirely with the physical aspects of human behavior and did
not purport to speak authoritatively on the moral, legal, social, and
psychological aspects which common experience would recognize as

being present. That these studies are not definitive would not need to
be said to those who are professionally concerned with the problem,
nor would Dr. Kinsey's group claim them to be such .
In addition to grants made to the NRC Committee for Research in
Problems of Sex, the Rockefeller Foundation has made grants for
studies of various aspects of sex to more than 2 dozen other university
and research centers, including the National Committee on Maternal
Health, Stanford University, the University of California, the Uni-
versity of Missouri, Yale, Columbia, Harvard, Hebrew University,
McGill University, Ohio State, the University of Berlin, the Uni-
versity of Gottingen, the College de France, and the Universities of
Pennsylvania, Rochester, Stockholm, Virginia, and Wisconsin .
An examination of this program will show that such studies are an
important part of an advance on a broad front in the life sciences,
taking their place alongside other foundation-supported research in
physiology, psychiatry, genetics, biology, biochemistry, biophysics,
marine biology, and related fields.
LONDON SCHOOL OF ECONOMICS AND POLITICAL SCIENCE
One of the committee's witnesses was critical of the London School

of Economics and Political Science which had benefited from founda-
tion support .29
The facts are the following . Between 1924 and 1928 the Laura
Spelman Rockefeller Memorial made grants totaling $1,245,000 to
the London School of Economics and Political Science, a division of
the University of London . Major aid from the Rockefeller Founda-
tion began in 1931 and continued until 1935, when a 5-year tapering
grant was made terminating general aid to the school, in line with the
policy then adopted by the foundation of discontinuing grants for
general support of social sciences at colleges and universities . Two
substantial grants were made after this date, one in 1939 ($51,250) to
provide funds required as a result of the wartime emergency and one
in 1949 ($50,900) for the new Department of Sociological and Demo-
graphic Research . Several smaller grants have been made for support
of particular programs of research or for support of particular schol-
ars associated with the London School.
Foundation grants to the London School total $873,348, most of
which have been used for physical improvements, for research, and
for postgraduate teaching .
The London School of Economics and Political Science is now and
has been for many years one of the world's important educational and
research institutions . Its faculty has included many distinguished
scholars who have served their country in important posts in war and
have contributed brilliantly to the increase of knowledge and under-
standing in peace . Its faculty, like any other university faculty, in-
cludes persons of varied shades of political opinion .
It is quite true that Sidney Webb played an important part in the
founding of the London School of Economics, and that Harold Laski
served on its faculty . That the school does not exist to inculcate any
particular poltical views should be taken for granted in the case of an
established university in a country with the highest traditions of free
28 Hearings, p . 215 ; see also p . 475 .
scholarship. That its roster has included such names as Lord Bev-
:eridge, Friedrich von Hayek, Lionel Robbins, Michael B . Oakeshott,
Sir Alexander Carr-Saunders, Sir Charles Webster, A . J . Toynbee,
D. W. Brogan, R . H . Tawney, Herman Finer, and many others of
equal distinction attests the wide range of points of view of its leader-
ship .
In the academic year 1953-54, the London School had a faculty
, of 148 and a student enrollment at 3,376, of which 898 (27 percent)
had come from 29 foreign countries .
THE NATIONAL BUREAU OF ECONOMIC RESEARCH
In view of the chairman's statement that the committee is primarily

interested in the "errors" of foundations, we must assume that when
the legal analyst's report, part II, calls attention to the Rockefeller
Foundation's support of the . National Bureau of Economic Research,3o
the intent is to be critical . The basis of the criticism is nowhere ex-
plicitly stated and is not easy to discover .
There is no effort to disparage the work of the national bureau-
rather the contrary . The legal analyst apparently believes that the
attack upon these grants is reinforced by sections of Fosdick's his-
tory of the foundation, which are quoted at some length . These sec-
tions point to the extraordinary value of the service performed by
the national bureau in bringing within reach "basic, articulated, quan-
titative information concerning the entire economy of the Nation" ;
the quotations conclude with the statement that "without the national
bureau our society would not be nearly so well equipped as it is for
dealing with the leading economic issues of our times ."
The legal analyst does not seem to challenge these statements . If
the national bureau performs such a unique and invaluable service,
why is the Rockefeller Foundation open to question for supporting
it? We have read and reread this section of the report with increas-
ing bewilderment, and without finding an answer which satisfies us .
The author quotes 31 a sentence from the foundation's annual re-
port for 1941 (written, presumably, during the early months of 1942)
reading as follows
If we are to have a durable peace after the war, if out of the wreckage of the
present a new kind of cooperative life is to be built on a global scale, the part
that science and advancing knowledge will play must not be overlooked .
"In the light of this attitude," the author continues, "some of the in-
dividuals and organizations benefiting from foundation funds in
the years since 1941 may seem a trifle unusual to say the least ." 32 This
is the preliminary, in part, to the citation of the national bureau .
Again we ask, in what respect is such an outstanding organization an
."unusual" beneficiary?
Coming back to the quotations from Fosdick, we find the statement
that the "basic, articulated, quantitative information" which the na-
tional bureau has brought within reach "has influenced public policy
at a dozen points ." 33 Here we may possibly have the clue . Are we
accused of using our grants to shape public policy because the data
and findings of the national bureau studies are cited, as Fosdick says,
S 0 Legal analysts report, Hearings, p . 894 .
3137 Legal analyst's report, Hearings, p . 895 .
Legal analyst's report, Hearings, p . 896 .
33
Legal analyst's report, Hearings, p . 896 .

TAX-EXEMPT FOUNDATIONS 1 141

in "official documents," because "They are used by businessmen, legis-
lators, labor specialists, and academic economists," 34 because "They
are constantly employed in Government agencies like the Depart-
ment of Commerce and the Bureau of the Census"? 35
If this is indeed the intended basis of criticism, it reveals little
familiarity with the work of the national bureau . This organization
is engaged, not in policy forming but primarily in factfinding . It
undertakes to supply the bricks, in the form, for example, of measure-
ments of the national income, measurements of money flows, measure-
ments of the volume of consumer credit, which policymakers will use
in developing their legislative and other structures . The best testi-
mony to the national bureau's impartiality is found in the fact that
both business organizations and labor organizations make contribu-
tions to it, not for specific studies but for general support .
It is unnecessary for us to elaborate on the work of the national
bureau, because of the description of this work which will be found
in the testimony before the Cox committee of William I . Myers, dean
of the New York College of Agriculture at Cornell University, and a
trustee of the Rockefeller Foundation and the General Education
Board since 1941 . 36
We cannot imagine a less fruitful enterprise than to seek for error
in the foundation's support of the National Bureau of Economic
Research.
THE PUBLIC ADMINISTRATION CLEARINGHOUSE
In the report of the legal analyst, attention has been drawn to the
foundation's concern with a "durable peace" as shown in quotations
from its annual reports . Its interest in the cooperative activities neces-
sary for such peace is also mentioned . It is then stated that, in view
of this concern, some of the individuals and organizations benefiting
from foundation funds since 1941 "may seem a trifle unusual, to say
the least * * * ." The Public Administration Clearinghouse is men-
tioned as one such organization ."
In the light of world events during the past decades, the interest
of the foundation in undertakings that may contribute to a durable
peace needs no defense. The only apparent reason for the listing of
the Public Administration Clearinghouse in this connection appears
to be that since peace involves "cooperation" and the Public Adminis-
tration Clearinghouse is an activity which obviously requires coopera-
tion by those who participate in it and since this cooperative activity
relates to the improvement of Government services, the legal analyst
considers it one of the agencies whose selection for support by the
foundation is considered questionable.
The Public Administration Clearinghouse was set up in 1931 to help
meet the need for an interchange of administrative data and experi-
ence from one public official or agency to another, so that what hap-
pened in one place might be promptly known and perhaps utilized in
another. Initial funds for its establishment and major support came
from the Spelman Fund of New York, which appropriated a total of
$2,805,250 for this work . The Rockefeller Foundation made grants
totaling $14,699 .
3 Legal analysts's report, Hearings, p . 896 .
as Legal analyst's report, Hearings, p . 896 .
3631 Cox committee hearings, p . 123 ff.
Report of legal analysts, Hearings, p . 895.
When the Public Administration Clearinghouse was organized,

communication between city and State and between States and the
Federal Government was narrowly restricted ; administrators of im-
portant functions too often worked in isolation without opportunity to
benefit from the experience and ideas of others engaged in like func-
tions in other jurisdictions, or from the research and experimentation
carried on in various universities and in centers of public administra-
tion research. The Public Administration Clearinghouse was estab
lished to remedy this situation, and it continues to render important
public service to Government officials and agencies . It has a proud
record of contributions to the improvement of standards, the exchange
of ideas, and the development of stricter codes of 'ethics among those
engaged in the various administrative functions of government . This
record is ample justification for its selection as a recipient of founda-
tion funds .
THE SOCIAL SCIENCE RESEARCH COUNCIL
Testimony before the committee criticizes directly and by infer-
ence the relationship between the Rockefeller Foundation and the
the Social Science Research Council . 38 It has been intimated that the
Rockefeller Foundation and other large foundations have tended to
dominate the Social Science Research Council ; 39 that the council, in
its turn, dominates the field of the social sciences ; 40 that these founda-
tions have used the council as an instrument in forwarding their "col-
lectivist purposes ; 41 and that by overemphasis upon the empirical
method, the council has contributed to a lessened reliance on basic
principles and a deterioration of moral standards .42
The Social Science Research Council is a voluntary association of
scholars chosen from seven associated professional societies in the field
of the social sciences and from related disciplines . It has spoken for
itself and with conviction . Its objectives are aimed at the improve-
ment of research organization and methods ; facilitation of research
efforts of scholars throughout the country ; development of personnel ;
enlargement, improvement, dissemination, and preservation of ma-
terials ; and the enhancement of public understanding and utilization
of the social sciences .
Since these are objectives in which the Rockefeller Foundation is
sympathetically interested, and since the members of the council are
outstanding scholars in thir own fields, the foundation has found sup-
port of the Social Science Research Council an effective means for
assisting the growth of knowledge of human affairs. The council no
more dominates its field than the American Law Institute dominates
the practice of law . The Social Science Research Council does, of
course, exert a large professional influence. But it is not the influence
of the Rockefeller Foundation ; it is the influence achieved by a group
of leading scholars as their abilities and accomplishments are recog-
nized and accepted in their profession .
Grants to the Social Science Research Council since its establish-
ment have been substantial, namely, $10,743,000 . This, however,
represents only 13 .24 percent of the appropriations of the Rockefeller
asse Hearings, pp . 45, 475 ; report of legal analyst, hearings, pp . 894, 898.
Hearings, p . 471 .
4o Hearings, pp. 601, 617 .
Foundation in the field of the social sciences . Since our total grants
in this area amount to more than $81 million, it cannot properly be
said that we have delegated our responsibilities to any single organ-
ization as an "agent."
UNIVERSITY OF WASHINGTON-FAR EASTERN SI UIYIES
(TAIPING REBELLION)
We refer to this grant only because the testimony about it received
by the committee illustrates the effort to build up a case against the
foundations from inadequately informed sources . One of the few
committee witnesses having an academic background first expressed
his personal discontent with what he described as "the so-called coop-
erative or group method of research ." 43 He admitted that in mak-
ing this criticism he spoke for himself alone . "I certainly don't
speak for my university, let alone for all of my colleagues in the uni-
versity, among whom I am sure will be found many people who will
disagree with much that I say ." 44 He agreed that "there is a great
divergence of opinion on these fundamental matters ." 45 Neverthe-
less, this witness furnished 12 pages of testimony expounding his
criticism of foundations for supporting this method of research .
Does the committee feel that the Congress should inquire into and
determine the relative merits of a team approach to scholarly re-
search as compared with an individual approach? If so, this would
be going far beyond what any foundation known to us has attempted
to do .
The witness who expatiated on this subject was asked by counsel
for the committee to discuss a grant, "I think it was a quarter of a
million dollars for a group study which seemed to be somewhat falli-
ble ." 46 He responded by referring to alleged "grants" by the Rocke-
feller Foundation which "probably came to that much" to the Uni-
versity 'of Washington for the purpose, as the witness put it, "of
group research on the Taiping Rebellion," 47 in China .
The fact is that the foundation made one grant, for a total of $100 9-
000, to the University of Washington's Far Eastern Institute, to be
used over a period of 7 years for expenses of research on the Far
East. While there have been other grants to the University of Wash-
ington, they were not directly connected with this group research
project. The university explained that the general aim of the re-
search program was to study Chinese society in transition, with the
Taiping Rebellion as the focal point . The committee's witness
agreed that "The Taiping Rebellion has long interested historians,
and it is worthy of a great deal of study ." 48
His sole objection was his individual opposition to the group ap-
proach to the problem . The determination to make this approach
was the decision of the university authorities, upon whom the foun-
dation exercised no influence in this regard . The foundation has
made many other grants to the University of Washington and to
other institutions where group research was not involved . The criti-
cism implies, therefore, that help should have been refused in this
4e Hearings, p . 526 .
4' Hearings, p . 530 .
ss Hearings, p . 530 .

case simply because this witness, on an admittedly personal basis,

dislikes such organization of research . We submit that this grant to
the University of Washington does not raise issues deserving of the
committee's time .
DEAN RusK,
President, the Rocke f eller Foundation .
Dated August 3,1954 .
STATE OF NEW YORK,
Dean Rusk, being duly sworn, says that he is president of the Rock-
efeller Foundation, the organization in whose behalf the foregoing
supplemental statement is made ; that the foregoing supplemental
statement is true to his knowledge except as to the matters occurring
prior to the date (as set forth in the accompanying principal state-
ment) of his association with said organization, which are therein
stated to be alleged on information and belief, and that as to those
matters he believes it to be true .
DEAN RUSK.
Sworn to before me this 3d day of August 1954 .
HAROLD B. LEONARD,
Term expires March 30,1955 .
SUPPLEMENTAL STATEMENT IN BEHALF OF THE GENERAL

EDUCATION BOARD, BY DEAN RUSK, PRESIDENT
The General Education Board submits this supplemental statement
to the Special Committee To Investigate Tax Exempt Foundations of
the 83d Congress . It supplements the joint principal statement by
the Rockefeller Foundation and General Education Board of the same
date and contains the General Education Board's comments upon
certain specific grants which were referred to in the public hearings
or committee staff reports .
This statement is verified under oath . Attention is invited to the
second paragraph on page one of the principal statement, regarding
the president's personal knowledge and statements made upon infor-
mation and belief.
COLUMBIA UNIVERSITY TEACHERS COLLEGE
Witnesses before the committee have interpreted grants made by the
General Education Board, particularly grants to Teachers College,
Columbia University, as evidence of an alleged intent on the part of
the board to propagandize a particular philosophy of education.' This
allegation is not sustained by the facts .
In 1920, Teachers College, Columbia University, received from the
General Education Board a grant of $1 million for endowment . Sub-
sequently a number of smaller grants were made for various projects
and studies at that institution, bringing the total aid received to
$1,540,397, exclusive of grants for the Lincoln School, which served as
2 Hearings, pp. 253, 288, 336, 485, 690, 720, 818-819,1497,1603-1607 .

a laboratory for the college . Grants in the amount of $667,500 2 were
also made by the Rockefeller Foundation, chiefly for research in child .
welfare and in nursing education .
In our principal statement (p. 62) we have pointed out that while
the major portion of the board's funds was used to strengthen and
support traditional education in long established American institu-
tions, some 8 percent of the board's grants were made for studies and
experimentation relating to improved educational, methods and ways
of utilizing new knowledge . Much of this assistance was in the form
of endowment and support of graduate schools of education . We
assume that few would question educational research as an appropriate
function of graduate schools of education . The importance of
strengthening and developing such schools was early recognized by
our trustees, and sizable grants for educational research and endow-
ment were made to George Peabody College for Teachers in Nashville,
and to the schools of education at Stanford University, Harvard,
Chicago, and Columbia . In this record of broadly distributed aid
there is no evidence whatever that the General Education Board nur-
tured a particular philosophy of education . These reputable institu-
tions would themselves deplore identification with any one educational
philosophy or practice, and a review of various current theories of
education would show that most of them have been represented at each
of the institutions mentioned .8
We understand that a statement has been submitted to this commit-
tee by Teachers College . We believe that the committee will find in
that statement evidence regarding the wide range of opinion reflected
in the writings and activities of the college staff, and also that the
college has had a positive program directed toward preventing the
infiltration of Communist doctrine into the teaching and activities of
its faculty and students .
Lincoln School, Teachers College
Mention has been made of the role of the General Education Board
in the establishment of the Lincoln School at Teachers College, Colum-
bia University.4 Between 1917 and 1929 the board' appropriated
$5,966,138 for the suppport of this school . This support was given in
response to recommendations made by Mr. Abraham Flexner in his
paper on "The Modern School" (a document which may still be read
with interest and profit) and in the light of a growing recognition
among educators that the curricula of both the elementary and sec-
ondary schools were no longer meeting satisfactorily the educational
needs of great numbers of their pupils . The Lincoln School was
essentially a laboratory. Through it one of the leading graduate
schools of education was afforded opportunity to test educational
theories that were then receiving attention from many thoughful edu-
cators. From the beginning its history was a controversial one . Many
of the theories tested there have since been discarded ; some are still
being studied ; others are now widely accepted. The Lincoln School
was closed in 1948 after the trustees of Teachers College, with the
approval of the New York courts, had concluded that the purposes set
2 As of June 30, 1954 ; the statement furnished the committee by Teachers College shows
a lower figure ; our figure includes foundation payments on grants made by the Laura
Spelman Rockefeller Memorial, prior to consolidation with the foundation, as well as a
grant for nursing education .
E, g. Judd, Hutchins, Dewey at Chicago, ; Cubberley, Cowley, Hanna, at Stanford ;
Bagley, Itandel, Kilpatrick, Counts at Teachers College, etc .
I Hearings, pp . 253-255 .
1 14 6 TAX-EXEMPT FOUNDATIONS
forth in the board's grants for the school could thereafter be more
effectively served by the establishment of an Institute of School Ex-
perimentation and the discontinuance of the private laboratory school .
The board's grants originally made for the Lincoln School are now
being used for this Institute of School Experimentation . Mr. Justice
Botein of the New York Supreme Court in his opinion on the matter
(March 20, 1947) says
It is inconceivable that the men who planned this thrilling adventure on the
frontiers of educational experimentation with the passionate deliberation of sci-
entists would confine its potentiality for a productive future to one particular
medium which might grow sterile . To analogize the unreality of such a position
we need think only in terms of the present . The plaintiff [Teachers College]
seems quite sanguine about the promise which the institute holds forth for fruit-
ful experimentation . But no educator would dare present it as an immutable
medium for perpetual productivity in experimentation!
International Institute, Teachers College
Several references have been made in the testimony to the support
given to the International Institute by "the Rockefeller interests ." s
It is true that the General Education Board made a grant to Teachers
College in support of this institute . The institute, which was part of
the college, was set up in 1923 to develop a specialized service for
foreign students. It provided assistance in the form of scholarships,
travel grants, and language instruction for some 3,852 students from
53 countries . At one time it served a group of more than 100 Ameri-
cans on furlough from missionary colleges and other institutions
abroad whose special circumstances called for something different
from the regular courses in pedagogy and school administration . The
staff of the institute kept in close touch with educational developments
abroad, and it has to its credit many notable contributions in the field
of comparative education, including the Educational Yearbook which
constitutes a comprehensive international review of educational
history for a decade and a half . The institute was discontinued in
1938 when many of its functions were absorbed by other divisions of
the college.
Faculty members, Teachers College
A witness has made numerous criticisms of the writings of Prof.
Harold 0 . Rugg and Prof . George S . Counts, both members of the
faculty of Teachers College, Columbia University .' Inasmuch as no
grants were made by either the Rockefeller Foundation or the General
Education Board to the persons named for the books mentioned by
this witness, we see no necessity for commenting on the criticisms . In
our principal statement we have pointed out that it has been the con-
sistent policy of the Rockefeller boards not to attempt to censor or
modify the findings of scholars and scientists employed by institutions
to which we have made grants ; nor do we attempt to determine faculty
appointments at these institutions .
EDUCATIONAL ASSOCIATIONS
There have been many references in the testimony to the support

given by the General Education Board to such educational associations
as the National Education Association and the Progressive Education
ITeachers college v. Goldstein et al ., 70 N. Y. supp . 2d 778 (1947) .
.Hearings, p . 287 .
7 See, for example, hearings, pp . 255, 48 .
Association, with the implication that through this support the board
gave aid to "pro-Socialist and pro-Communist propaganda projects ." "
In our principal statement (pp. 63-65) we have already discussed that
phase of the &eneral Education Board's program which was especially
concerned with the improvement of general education at the secondary
school and junior college levels . We have shown that throughout this
diversified program in which a great many institutions and many
people with different points of view participated, there was no effort
on the part of the Board to slant school and college curricula in a
particular direction . We categorically deny that any board grants
were ever made for the purpose of supporting pro-Socialist and pro-
Communist propaganda projects .
Our annual reports show that large grants were made to the
National Education Association and to the Progressive Education As-
sociation. When the board began its program in general education,
there were three major educational organizations in this country with
national membership and general concern with education at all levels .
These were the American Council on Education, the National Educa-
tion Association, and the Progressive Education Association . Among
the other large and important groups with broad rather than special-
ized interests at the secondary school level were the Regional Accredit-
ing Associations, the American Association of Junior Colleges, the
American Association of School Administrators, and the National
Association of Secondary School Principals, the latter two being part
of the National Education Association . These groups were bound to
have a strong influence on the future development of education, and it
was natural, therefore, that the General Education Board should re-
spond to requests from them for aid in projects concerned with the im-
provement of secondary education .
Any defense of the character of the organizations mentioned is
roperly left to the responsible representatives of those organizations .
ith regard to the board's grants to the National Education Asso-
ciation and the Progressive Education Association, we make the fol-
lowing comments .
National Education Association
The National Education Association, which is a large . professional
organization of American schoolteachers and administrators chartered
in 1906, received grants from the General Education Board totaling
$495,743 . These grants were used for various projects, the largest one
being for support of the Educational Policies Commission ($355,979) .
When the commission was organized in 1935, its purposes were pre-
sented to the board as follows
To stimulate thoughtful, realistic, long-term planning within the teaching pro-
fession on the highest possible level, looking toward continued adaptation of
education to social needs .
To appraise existing conditions in education critically and to stimulate educa-
tional thinking on all levels so that desirable changes may be brought about in
the purposes, procedures, and organization of education.
To consider and act upon recommendations from all sources for the improve-
ment of education .
To make the best practices and procedures in education known throughout the
country and to encourage their use everywhere .
To develop a more effective understanding and cooperation between various
organized groups interested in educational improvement .
8 Hearings, p. 36 .
Board funds aided the commission over a period of 9 years . During

this time its prestige was such that the following eminent persons
were at various times members of the commission
Dwight D . Eisenhower (then president of Columbia University)
James B . Conant (then president of Harvard University)
Edmund E . Day (then president of Cornell University)
Arthur H. Compton (then chancellor of Washington University)
George D . Stoddard (then commissioner of education for the State of New York)
Frederick M . Hunter (then chancellor of the University of Oregon)
J . B . Edmondson (then dean, School of Education, University of Michigan)
J. W. Studebaker (then United States Commissioner of Education)
Progressive Education Association
The Progressive Education Association was an organization estab-
lished in 1919 to foster a continuous improvement in educational
practices. At the time when the board made its first grant to the
association, its purposes were set forth as follows . in a leaflet pub-
lished by the association
The association is the only organization devoted to the work of spreading
knowledge of progressive education principles . Its membership, numbering over
7,000, is confined to no single group, profession, or locality . It includes admin-
istrators, teachers, and students in public and private schools and the colleges,
parents and the laity generally from every State of the United States and in 20
foreign countries . It is constantly growing, widening its influence, making new
contacts, assuming new obligations, engaging in new enterprises in the field of
education .
The association is not committed, and never can be, to any particular method
or system of education. In regard to such matters it is simply a medium through
which improvements and developments worked out by various agencies can be
presented to the public .'
In the 1930's the association was doubtless the most active group of
educators concerned with studies looking toward the improvement
of education, and it was among the first to direct attention to prob-
lems in secondary education . While its members came from both
public and private schools and held a wide variety of beliefs as to what
constituted educational improvement, on one thing they were agreed-
that experimentation and change were necessary if American educa-
tion was to keep abreast of the needs of modern life .
The Progressive Education Association worked through national
commissions engaged in research and investigation of educational
problems and through conferences and summer institutes. It was in
the work of these several commissions that the General Education
Board was interested . There were three of them with large and rep-
resentative memberships . One conducted an 8-year study of the
relation between school and college in which 30 schools participated ;
another engaged in an extensive study of the secondary school cur-
riculum and in a study of adolescents ; a third experimented with the
use of new materials, such as films, in helping young people gain a
better understanding of personal relationships .
A few small projects related to the studies of these commissions
were also aided, and while the commissions were active the board
made contributions toward the general support of the association so
that it might respond to the interest aroused by studies being con-
ducted by its commissions and coordinate their activities through
its central office. A total of $1,622,506 was made available by the
board to the association.
a Pamphlet-Progressive Education-What it is, how it is promoted, why it is of
interest to you (Progressive Education Association, Washington, D . C ., 1934), pp . 3-4 .
The major grants made to the Progressive EducationAssociation
were
General support (8% years) $119,407
Commission on Relation of School and College (30 schools and a group
of higher institutions participated) 605,799
Commission on the Secondary School Curriculum 359,965
Commission on Human Relations 222,969
Service program 260,298
The board's last grant for the service program of the association (a
program involving summer workshops in which 14 of the major uni-
versities cooperated) was made in 1939 . Meanwhile the commissions
had just about finished their work . With the development of war
tensions there was a rapid decline in interest in educational experi-
mentation ; the association's membership dropped off sharply ; and
as members entered war service there was a turnover in leadership .
A final grant was made to the association in August 1943-$1,500 to
meet the expenses of a meeting of its full board of directors for the
purpose of defining future policy and program . It was made clear
at that time that no further assistance might be expected from the
General Education Board . Sometime during 1944 the Progressive
Education Association changed its name to American Education Fel-
lowship . We understand that in 1953, after a study and revision of
policy, it once more assumed its old name .
SOCIETY FOR CURRICULUM STUDY, BUILDING AMERICA
The charge has been made that the Building America series, which
the General Education Board supported with 3 grants to the Society
for Curriculum Study totaling $51,000, made in 1935, 1936, and 1938,
was propaganda showing that "The United States is a place of desti-
tution, failure, unsound conditions" and that "sympathetic Russia is
sweetness and light ." 10
Building America, which was developed as, a new type of teaching
material, was a periodical dealing with important phases of social,
political, and economic life and designed principally to help secondary
schools meet the need for instructional materials dealing with modern
life . The magazine emphasized pictures and graphs as a means of
presenting facts and suggesting problems .
The Society for Curriculum Study was a national organization of
professional workers in public and private schools and in State depart-
ments of education, and of university professors who were especially
interested in curriculum matters . The business of the society was
conducted by an executive committee of reputable and representative
educators, including at various times between 1935 and 1950 the
following
Fred C . Ayer, University of Texas
H. L. Caswell, Teachers College, Columbia University
Doak S . Campbell, George Peabody College
Prudence Cutright, Minneapolis Public Schools
Edgar Draper, University of Washington
Samuel Everett, Northwestern University
Helen Heffernan, California State Department of Education
0. Robert Koopman, Michigan Department of Public Instruction
J. Paul Leonard, Stanford University
Paul J . Misner, Superintendent of School, Glencoe, Ill.

J. Cecil Parker, Michigan Department of Public Instruction

Ralph D. Russell, University of Idaho
The editorial board of Building America was selected by the so-
ciety's executive committee and was under the chairmanship of Dr .
Paul R . Hanna of Stanford University. The, editorial board's state-
ment of policy, on the basis of which the General Education Board's
grant was made, indicated that the magazine would strive to present
social data and problems in a fair and scientific spirit . The project
clearly related to the board's program in general education which was .
concerned with the improvement of secondary education .
In accordance with the board's basic policies, the aid given to Build-
ing America was considered temporary and was expected only to give
the Society for Curriculum Study an opportunity to explore and,
evaluate a new type of teaching material . When board support ter-
minated in 1940, the Society for Curriculum Study 11 continued the
development and publication of Building America in both magazine-
and book form . The article on Russia, which was severely criticized
in the testimony before this committee, 12 was published in 1944, 4 years
after board support terminated .
In summary, the board made grants for the benefit of Building
America on the basis that the funds would be used to support a worth-
while test of new teaching material which would be presented ob-
jectively . The board had good reason to believe that the funds would
be so used because of the representative and responsible educators who .
sponsored the project, their assurances as to the nature of the publi-
cation, and the preliminary material furnished the board . Although
the board does not attempt to supervise the studies supported by its
funds, as we point out in our principal statement (p . 11-13), we
believe there is no ground for the charge that the Building America .
series was propaganda for communism or socialism .
DEAN RUSK,
President, General Education Board .
Dated August 3,1954.
STATE OF NEW YORK,
Dean Rusk, being duly sworn, says that he is president of the Gen-
eral Education Board, the organization in whose behalf the fore-
going supplemental statement is made ; that the foregoing supple-
mental statement is true to his knowledge except as to the matters
occuring prior to the date (as set forth in the accompanying prin-
cipal statement) of his association with said organization, which are
therein stated to be alleged on information and belief, and that as to
those matters he believes it to be true .
DEAN RUSK.
Sworn to before me this 3d day of August 1954.
SEAL] HAROLD B. LEONARD,
Notary Public .
Term expires March 30, 1955 .
11
In 1942 the Society for Curriculum Study and the Department of Supervisors of the
National Education Association merged to form the Department of Supervision and Cur-
riculum Development of the National Education Association . In 1946 the name of this
group wasEducation
changed Association
to the Association
. Upon theformerger,
Supervision and Curriculum Development,
National Building America became a property
of 12the department and then of the National Education Association .
Hearings, pp . 209 et seq.


STATEMENT OF WILLIAM G. CARR, EXECUTIVE SECRETARY, THE
NATIONAL EDUCATION ASSOCIATION OF THE UNITED STATES
We understand that your committee is authorized and directed,
among other matters, to conduct "an investigation and study of educa-
tional and philanthropic foundations, and other comparable organiza-
tions which are exempt from Federal income taxation, to determine
if any of them are using their resources for purposes other than the
purposes for which they were established, and especially to determine
which, if any, are using their resources for un-American and sub-
versive activities ; for political purposes ; propaganda, or attempts to
influence legislation ."
It is also understood that during the public hearings which you
have now terminated, your committee heard testimony derogatory to
the National Education Association . From such of the testimony
as we have been able to collect and examine, we assert that 'those
derogatory statements are inconsistent, unfounded, and erroneous .
Since we may not testify before your committee in public, we are
unable to learn whether any of the previous testimony is regarded by
your committee as worthy of further examination. If you wish fur-
ther information on any specific allegations in this previous testi-
mony, which is not adequately provided in this memonrandum, repre-
sentatives of the association, upon suitable notice, will be prepared to
supply such information as may be appropriate and relevant .
Therefore, in the brief statement which is hereby submitted for
your record, we have not attempted to deal with previous testimony
on a point-by-point basis . This testimony, insofar as we have been
able to examine it, is so vague and so self-contradictory, that detailed
comment seems unncessary . We have, therefore, included in this
statement a body of information about the association which we deem
adequate to establish that the National Education Association of the
United States has a proud record of loyalty to this country and to its
ideals ; that the association is controlled by its members ; and that it
cooperates with the public in the study and solution of educational
problems .
We urge that your committee, in any report it may issue, explicitly
reject any implication that the resources of the National Education
Association are used in an improper manner.
UN-AMERICAN ACTIVITIES
Before presenting this brief statement, it is desirable, however, to
make certain preliminary observations .
It sems obvious that in order to determine what associations and
foundations, if any, are "using their resources for un-American and
subversive activities," it will be necessary for the committee to identify
our basic American traditions and ideals. Unless these criteria are
well established in the minds of the committee and its staff, as well as
in the minds of witnesses who may appear before it, testimony and in-
quiry would seem to be of little value .
The American tradition is a complex one with a long and splendid
history. Your attention is respectfully directed to several component,
of this tradition which we deem to be important in the task assigned to
your committee and in the work of the National Education Associa-
tion.
49720-54-pt . 2 14

1. One component of the American tradition is the freedom to form

voluntary organizations for the promotion of all lawful purposes and
for the advancement of the principles and ideals to which a group sub-
scribes .
2 . A second tradition dear to all Americans is resistance to what
Jefferson called tyranny over the minds of men . In positive terms,
this means the right to express opinions, even minority opinions on
controversial questions, without fear of direct or indirect reprisal, and
the right to revise opinions as conditions change and new circum-
stances come to light .
3. A third tradition basic to the American way of life, and of par-
ticular importance to your committee and to the National Educa-
tion Association, is the value attached to the education of all the people .
By this means, the founders of our country believed, popular govern-
ment may long endure, because its citizens have learned to exercise
independent and informed judgment in the direction and control of
their own personal affairs and in the affairs of state .
4. There are many other elements in the rich and varied pattern of
our country's tradition. At least one more such tradition should be
mentioned . To state it negatively first-it is not the American ideal to
be hostile to change . On the contrary, this country is great because its
citizens have been free to propose and to adopt modifications in the
structure of their Government, and of their other institutions . They
have believed it is the right and the duty of good citizens to adapt their
political and social institutions, within the broad framework of our
constitutional freedoms, to meet new circumstances and conditions . .
These are some of the American traditions . If loyalty to such
traditions is loyalty to the United States, then the whole program of
the National Education Association and of the teaching profession in
this country has been, and will remain, a basic strength to our country
and to her traditions .
The members of the National Education Association are proud that
they have given effect to these traditions by combining their efforts to
elevate their profession . They are proud of the "free and voluntary
nature of their association, and of its sense of responsibility to the chil-
dren and youth of this country . They are proud of its ability to
present the views of the teaching profession, on every appropriate
occasion, to the lawgivers and statesmen who enact legislation which
profoundly affects our schools .
We consider that an association which brings together citizens vol-
untarily for a lawful purpose, which encourages freedom of thought
and expression, which promotes the education of all the people, and
which leaves the door open to change and growth, is essentially in ac-
cordance with the American tradition . Conversely, of course, we be-
lieve that efforts to impede this process, to impair the efficiency of our
voluntary organizations, to hamper and circumscribe their work, to
cast doubts upon the propriety of free discussion, to narrow and im-
poverish the education of the people, or to deny the possibility of all
modifications in our social arrangements, are profoundly un-American
and hostile to the best traditions of our country .
SOME FACTS ABOUT THE NATIONAL EDUCATION ASSOCIATION
The remainder of this statement about the National Education As-

sociation of the United States will include condensed facts on the
following
1 . Purpose, history, and records .
2 . Membership .
3. Organization and officers .
4. Foundation grants to the agencies of the association .
5. Cooperation with other agencies .
6. International activities .
7 . State and local responsibility for public education .
8 . Public participation in the formation of public-school policy.
1 . Purpose, history, and records
The National Education Association is an independent, voluntary.
nongovernmental organization . In the briefest possible terms, the
association may be said to support the following ideas : That educa-
tional opportunity is the right of every American child ; that sound
education is essential to the safety, happiness, and progress of the
United States ; that our decentralized school system is a valuable part
of the American tradition ; that the preservation of freedom in this
Nation depends on a citizenry which has been educated to know, to
appreciate, to understand, and to defend the American heritage.
The ramifications of this general point of view can be traced in
detail in the platform and resolutions of the association, which are
filed as exhibit A.
With such premises, the association is strongly opposed to all forms
and philosophies of Government which deny freedom or ignore the
worth of each individual human being .
The National Education Association was organized August 26,
1857, at Philadelphia, Pa . It was incorporated by the Congress of
the United States on June 30, 1906 .
The act of incorporation clearly states the purpose of the organi-
zation
To elevate the character and advance the interests of the profession of teach-
ing, and to promote the cause of education in the United States .
The act of incorporation also provides for the establishment of
departments, and for the framework within which the members of the
association administer and control its affairs .
The association as a matter of regular procedure makes available
full reports of its meetings, reports, and financial transactions . These
reports and proceedings are published annually and are widely dis-
tributed. Its reports to the Bureau of Internal Revenue, as a tax-
exempt organization, are also a matter of public record .
°2 . Membership .
On May 31, 1954, the National Education Association had enrolled
561,708 members. This number amounts to approximately half of
the total number of persons engaged in teaching in the public ele-
mentary and secondary schools .
The members of the National Education Association live and work
in nearly every city, town, village, and hamlet in this country .
. 1 154 TAX-EXEMPT FOUNDATIONS
The bylaws, a copy of which is attached as exhibit B, state in detail

the conditions and classes of membership in the association . They
also provide that-
No person shall be admitted or continued in membership in the National
Education Association, who advocates or who is a member of the Communist
Party of the United States or of any organization that advocates changing the
form of government of the United States by any means not provided for by
the Constitution of the United States .
Most of the members of the National Education Association teach
in the public elementary and secondary schools as employees of the
Nation's 60,000 local school boards . The membership includes kin-
dergarten teachers, teachers in the elementary and secondary schools,,
professors in colleges and universities, principals, deans, college
presidents, school superintendents, and all other professional work-
ers in education .
Within the association there are many different civic and profes-
sional opinions. Individually, the members of the National Educa-
tion Association belong not only to all communities, all States, and
all levels of educational effort, but also to all the major churches, .
civic bodies, and political parties . However, the National Education
Association itself is not affiliated with any of the political, economic,,
or religious groups within the United States . The independent pro-
fessional status of their association is greatly cherished and respected,
by its members .
3. Organization and officers
From June 27 to July 2, 1954, the National Education Association
held its 92d annual convention in New York City . The representative
assembly included 4,970 delegates . They represented all the State
and Territorial affiliates, and most of the 5,000 affiliated local educa-
tion associations. These delegates selected their own officers, evalu-
ated reports, scrutinized their association's budget for the next year, .
studied their professional needs and problems, and developed the of-
ficial policy of the association .
The affiliated units, both State and local, which send their delegates :
to this policy-forming agency are autonomous . The policies that
guide the National Education Association are established by these .
representatives of responsible teacher-citizens from coast to coast .
The decisions of the representative assembly are binding . They are
carried out by the executive committee and the board of directors . .
Every member of the executive committee must stand for reelection,
every 2 years . A member of the board of directors is elected for a .
3-year term by his colleagues in his own State . The executive secre-
tary and his staff work under the direct supervision of the executive
committee and the board of directors . All elections are by secret
ballot .
Roughly, two-thirds of all delegates are classroom teachers . Others
hold administrative or other nonteaching educational positions . On.
the average, each delegate represents about 113 members of the organ--
ization. The NEA representative assembly is extremely well attended ..
Proposed resolutions and other policy-forming decisions are vigor-
ously debated and frequently amended . The budget is reviewed, line
by line, on the request of even a single delegate .

With the exception of certain former presidents of the association,

who were elected prior to July 1, 1937, there are no permanent officers
whatever in the National Education Association . The surviving life
directors now number only 12 .
A full account of the origin, purpose, functions, and programs of
each committee, commission, division, department, or other unit of
the National Education Association, is published annually in the NEA
handbook . The NEA handbook, like the annual proceedings, is pub-
lished and is available for public reference in all important libraries .
A copy is filed with this report as exhibit C .
The charter and bylaws provide for the departments in the National
Education Association . There are currently 29 of these departments .
Their scope is defined in terms of subjects of instruction or of some
other special aspect of educational service . Each department, except
in a few routine respects, is autonomous. Most of the departments
have their own dues-paying members . Every department has its own
constitution and its own separate, elected, policymaking board, re-
sponsible to the members of that department .
In short, the National Education Association is a highly decen-
tralized body of educational workers .
In 1950, the association adopted a code of principles on the extent
to which association policy may be expressed by subordinate units .
Relevant sections of this code are Nos. 6, 7, 8, and 15 . They are quoted
below
No. 6. No NEA unit action, becomes association policy without official action .-
No action or pronouncement of any NEA unit is binding upon the NEA until it
has been approved by the representative assembly or, during intervals between
meetings of the representative assembly, by the executive committee .
No . 7. Freedom within general policy .-Units of the NEA are free, within their
respective fields of work, to publish conclusions upon any matter where no gen-
eral NEA policy has been established .
No . 8. Adherence to official NEA policies .-(a) Committees and commissions :
When the NEA decides upon an official policy through action or resolution of the
representative assembly, through its charter and bylaws, or through its plat-
form, then every committee and commission must adhere to that policy as long
as it is the policy of the association .
(b) Departments : Departments of the association, before adopting policies,
should consider the question of possible differences with official NEA policy .
All NEA units should seek at all times to present a united front .
No. 15. Authority to speak for the association or its units .-Only the National
Education Association, through its own duly-authorized bodies or agents, can
speak for the association on matters of policy . The same principle applies to the
departments, commissions, and committees of the NEA ; only the unit itself or its
own duly-authorized officers or committees can speak for the unit . For this
reason, no cooperative council, committee, or other agency in which the asso-
ciation or a unit of the association is a 'member is authorized to speak for or
represent the National Education Association or any of its units unless written
authorization covering the specific matter involved has been granted .
4. Foundation grants to agencies o f the association
Approximately 90 percent of the National Education Association
revenues come from the dues of its individual members . Most of the
remaining 10 percent comes from such incidental sources as sale of pub-
lications, exhibits, and advertising . Grants from foundations have
been even less important as a source of revenue for the association . In
the rare instances where units of the association have been awarded
such grants, the award and its purposes and results have been publi-
cized .

By provision of the charter granted by Congress, the National Edu-

cation Association must annually report to the United States Com-
missioner of Education, stating the property held by the corporation,
and the disposition of the income thereof during the preceding year.
In practice, a very much more complete report than this is filed with
the Commissioner of Education, showing in detail the entire financial
operation of the association, as well as of its committees, commissions,
and departments .
A study has been made, covering the past 11 years, of all gifts,
grants, and foundation awards to the association and its subordinate
units . The value of such gifts, grants, and awards, in the 11 years,
totals slightly over $2,500,000. Over $750,000 of this amount was
given to the NEA by thousands of its own members in small, indi-
vidual gifts to the war and peace fund and to the overseas fund . These
funds were used to finance the special wartime services of the asso-
ciation and, after the war, to assist teachers in war devastated coun-
tries . The overseas fund continues at present to provide material
assistance to teachers in the Republic of Korea .
The total grants by the Ford Foundation, the Rockefeller Founda-
tion, and the Carnegie Foundation, during the 11-year period, have
been less than $400,000. The association has received 13 times as much
income from such minor sources as the sale of publications and ad-
vertising space in its magazine as it did from these foundations .
5, Cooperation with other agencies
The association has a standing policy of active cooperation with
re,nonsible civic and professional groups . It maintains joint com-
mittees, for example, with the American Legion, the American Medi-
cal Association, the National Congress of Parents and Teachers, and
the Magazine Publishers Association . It invests a substantial part
of its resources in endeavoring to discover what the American people
expect of their schools, and in turn to interpret the needs of the schools
to the American people.
For 8 years the National Education Association has cooperated
with the United States Department of Justice in the annual Confer-
ence on Citizenship. The ninth such conference will be held in Wash-
ington on September 15-17,1954 .
In 1950, the NEA helped to organize the All-American Confer-
erence to Combat Communism . It has sent representatives to the
meetings and participated in other ways. Other groups in this con-
ference include the American Legion, Lions International, the Federal
Council of Churches of Christ, and many other national organizations .
The above are merely examples of the many kinds of cooperation
which the NEA, as a matter of policy, extends to other groups .
6. International activities
The National Education association has endeavored to support the
policies of the United States Government regarding good will to
people of other lands, and regarding the success of the United Nations
and its specialized agencies . The association has cooperated with
the United States Government, and with private agencies, in facili-
tating the exchange of teachers and students with friendly, foreign
countries . It has promoted the establishment of a democratic inter-
national teachers organization .

Through the generosity of its individual members, the association
has sent about one-half million dollars' worth of clothing, school sup-
plies, food, book, and medical supplies, to overseas teachers who were
victims of aggression and war devastation .
In its relations with current international issues, the association has
been guided by the following policy which is quoted from the NEA
platform and resolutions
As a measure of defense against our most potent threat, our American schools
must teach about communism and all forms of totalitarianism, including the
practices and principles of the Soviet Union and the Communist Party in the
United States. Teaching about communism does not mean advocacy of com-
munism . Such advocacy should not be permitted in American schools .
The association is opposed by longstanding policy to the employ-
ment of members of the Communist Party in the schools of the United
States.
The international governmental agency most closely allied to the
work of the NEA is UNESCO . This organization was established
after both Houses of Congress unanimously approved resolutions in-
troduced by Senator Fulbright, the late Senator Taft, and by Senator
(then Representative) Karl Mundt, in favor of international coopera-
tion in this area.
7. State and local responsibility for public education
The control of public education is the responsibility of the States
and localities. The policy of the National Education Association is
unequivocal on this point . A glance at the NEA platform and reso-
lutions will show this clearly .
As a professional association, the National Education Association
does not possess the authority to instruct its members with respect
to curriculum or content of teaching, or to issue any kind of direc-
tives on such matters . It has never issued such directives .
The policies, suggestions, and recommendations offered by the
National Education Association derive their strength from the rea-
soning and evidence which lies back of them . They may be adopted
or rejected by individual members of the profession, or by individual
members of the association, or by local or State school systems as,
seems best to those who do have such responsibility .
8. Public participation in the formation o f public school policy
The National Education Association is committed to the principle
that the people of each local community, in each State, and through-
out the Nation should participate actively in the formation of public
school policy. The association has encouraged the growth of the
National Congress of Parents and Teachers . It has cooperated ac-
tively with the National School Boards Association . It has supplied
material to, and welcomed the creation of, the National Citizens Com-
mission for the Public Schools . The association does not advocate that
the teaching profession should have exclusive authority with re-
spect to public school policy . It recognizes that public interest in
these matters is great, and has a legitimate channel of expression.
The best safeguard for our free, democratic schools, is the kind of
wide understanding and broad public participation which the asso-
ciation has consistently advocated .
The association is proud of the record it has maintained . Approval
has been extended to its work by the highest military and civil lead-

ers of our country . For example : In 1950 President Truman wrote to

the national conference which the NEA sponsors jointly with the
Department of Justice
You are making a magnificent contribution to the general welfare of the
Nation . As long as patriotic citizens of every faith and creed, group and in-
terest, gather in harmony and in unity to discuss the problems of the hour, we
need have no fear of ideologies inimical to our precious democratic way of life .
And in 1952, President Eisenhower wrote
The significant contribution of the National Education Association to the
Nation's children and youth, and its excellent service to the teaching profession,
is well known .
The members and officers of the National Education Association
believe that their professional association merits recognition and com-
mendation from these national leaders . They are proud to affirm that
the teaching profession is devoted and will remain devoted to the
development of freemen .
DISTRICT OF COLUMBIA,
City o f Washington, ss :
William G. Carr, being duly sworn, deposes and says
1 . I am the executive secretary of the National Education Associa-
tion of the United States and am familiar with the objects, purposes,
and operations of the association .
2. I have prepared the foregoing statement under the direction and
in cooperation with the executive committee of the association and
declare that it is true and correct with respect to those matters stated
upon personal knowledge ; and that with respect to matters not stated
upon personal knowledge, it is true to the best of my knowledge and
belief.
WILLIAM G. CARR .
Sworn to before me this 9th day of August 1954 .
[SEAL] MARY E. WIBEL,
Notary Public.
My commission expires November 1, 1955 .
STAFF REPORT ON AMERICAN LABOR EDUCATION SERVICE, INC.
This memorandum is submitted for the purpose of setting forth
some of the activities of American Labor Education Service, Inc.,
which bear on that part of the scope of this committee's investigation
directed to the question of whether certain foundations "are using their
resources * * * for political purposes, propaganda, or attempts to
influence legislation" (H . Res. 217) .
The American Labor Education Service, Inc . (hereinafter simply
referred to as "ALES") is a tax-exempt foundation, listed on page 9
of the 1952 Supplement to the Cumulative List of Organizations (con-
tributions to which are deductible) published by the Bureau of In-
ternal Revenue of the United States Treasury Department . Accord-
ing to United States Citizens in World Affairs, a directory of non-
governmental organizations published by the Foreign Policy Asso-
ciation in 1953, ALES has 10 full-time staff members at headquar-
ters and in the field . The same booklet reports that ALES is a mem-

ber of the International Federation of Workers' Educational Asso-
ciations and that its objectives in international affairs are "to cooper-
ate with the labor movement in intensifying education in the field of
international affairs ; to stimulate the interest of leaders in interna-
tional affairs ; and to encourage the study of such issues within the
groups and unions."
A perusal of ALES annual reports and conference programs reveals
that "intensifying education" is very closely related to, if not iden-
tical with,
ground of propaganda
propaganda and political action . Moreover, the back-
staff members, together with the list of personnel
participating in ALES conferences, suggest an interlocking direc-
torate of individuals and groups who have been associated with mili-
tant socialism, and even, in some cases, with Communist fronts .
For instance, as set forth in exhibit 1 annexed hereto, Eleanor C .
Anderson (also known as Mrs . Sherwood Anderson) listed in the
ALES annual report for 1953 as its treasurer and a member of its
board of directors, was cited 10 times in the Dies committee hearings
and 20 times in the appendix IX of the House Committee on Un-
American Activities ; Max Lerner, its former treasurer and member
of the board of directors, was cited 20 times by the Dies committee and
31 times in appendix IX ; J . Raymond Walsh, a director and vice
chairman up until at least 1948, was cited 22 times by the Un-Amer-
ican committee ; and 12 times in appendix IX ; Edward C. Lindeman,
a director until his death in 1953 was cited 8 times by the Dies com-
mittee and 19 times in appendix ik.
The American Labor Education Service sponsors an Annual Wash-
ington's Birthday Workers' Education Conference . According to
page 1 of an ALES invitation to one of these affairs, dated February
25-26, 1950, this general conference for leaders, teachers, and others
professionally interested in workers' education "was started at Brook-
wood Labor College in 1924 under the auspices of Local 189 of the
AFT" (American Federation of Teachers) . (In 1928, the A. F . of L .,
with one dissenting vote, issued a ban against Brookwood Labor Col-
lege as "an incubator of Communists ." (See New York Times, Nov .
29 9 1928, p. 12.)
Under letter of October 2, 1946, ALES invited its members to
attend a conference in Milwaukee, stating, among other things
"The topic for this year's discussion is a timely one `How Can
Worker's Education Advance Labor's Economic and Political Ob-
.
jectives'
"At the dinner, we shall consider methods labor must use when col-
lective bargaining does not work, especially methods o f dealing with
the Government." [Italics ours.]
The agenda for the 1947 ALES Midwest Workers' Education Con-
ference (weekend of November 1-2 at Hotel Moraine, Highland Park,
Ill .) notes the following discussion groups on the subject of Defin-
ing and Advancing Labor's Objectives in 1947-48 : A. Collective
Bargaining Under New Federal and State Legislation ; B. Labor's
Community Relations ; C . How to Maintain Union Strength in the
Face of Inflation and Depression ; D. Political Action for Labor
[Italics by ALES .]
Workshops on Education, according to the same agenda, included
these topics : "F. Developing Radio Program; G . Utilization of the
Press ; H. Political Action Techniques ; J. Improving Farmer-Labor

Relations ." [Italics by ALES .] These are the kind of workshops
that would be appropriate for a gathering of politicians ; they do not
suggest the ordinary seminar .
An ALES letter, dated January 30, 1948, which announces the
annual conference for that year, reads in part
This year special emphasis will be placed on workships for the discusssion
of practical problems of current interest to those working in the field . * * *
Six technical workshops are scheduled from 2 to 5 o'clock on Saturday after-
noon, the topics for which will be : how to integrate educational work in the
unions, the use of sociodrama in the training of shop stewards, specific curric-
ulum and content needs for labor education activities, practical methods for
developing labor's interest as consumers, techniques for more effective farmer-
labor cooperation, and advances recently made in the use of audiovisual aids .
The first three workshops listed on the enclosed program will be open to all
those engaged in any form of workers' education . The second three will be
open to those who carry on labor education in unions .
On Sunday morning a panel of experts will discuss methods and materials
which will implement labor's foreign policy .
Developing farmer-labor cooperation and "implementing labor's
foreign policy" might be characterized as education for labor in order
to obtain political objectives, rather than education of labor .
An ALES letter, dated June 4, 1948, asking for financial aid from
friends reads in part
Two trends, in American life make workers' education an issue of paramount
importance. One is the attempt to eliminate racial discrimination in trade
unions and the other is the Taft-Hartley labor bill and what it symbolizes . * * *
Certainly, the passage of the Taft-Hartley bill indicates among other things,
the need for an intensive "push" in labor education . The American Labor Edu-
cation Service is equipped to furnish this "push," equipped in every way save
one, namely adequate budget . I am writing, therefore, to ALES friends, who
realize the strategic role which organized labor must play in our democratic
struggle, asking for continued financial help . * * *
"Pushing" against the Taft-Hartley bill-and soliciting funds for
such a "push"-would seem to be activities related to lobbying and,
therefore, not tax exempt.
The tentative program of the ALES Midwest Workers' Education
Conference, November 13-14, 1948, in Milwaukee, Wis ., noted that
the keynote session would be "The union's responsibility in forward-
ing democracy in the world scene today ." Workshops dealt with the
problem of "How can workers' education stimulate democratic partici-
pation * * * through legislative activity, through winning commu-
nity understanding and more effective participation in community or-
ganization, through political activity and farmer-labor cooperation ."
The dinner meeting on Saturday evening was concerned with the
"Development of program of the Economic Cooperation Administra-
tion and labor's responsibility for supporting it ."
An ALES conference at the New School for Social Research, held
February 25-26, 1950, discussed The Contribution of Labor in Re-
building Democratic Society and the Role of Workers' Education in
Political Action . (See p . 2 of ALES Agenda that date .) It was
noted that a "panel discussion will cover the urgency of participation
in political action by labor, and the reevaluation of education in re-
lation to political action ."
It seems clear that a significant portion of the ALES program is
devoted to planning and promoting political action . It appears to
be especially active in recruiting mass labor support for a private
brand of interventionist foreign policy, the U . N. and its various
agencies, foreign aid, and the concept of worldwide social and eco-
nomic security . Some of the money for "discussion programs in in-
ternational affairs for labor-union representatives" has been granted
to ALES by a subsidiary of the Ford Foundation, the Fund for
Adult Education . On page 34 of the fund's report of its grants from
January 1, 1952 ; to June 30, 1953, it is noted that ALES had been
granted a total of $190,000 of which $95,000 was still unpaid.
It is admittedly difficult to draw the line between discussion pro-
grams which are truly "educational" and those which are designed to
proselytize for a particular viewpoint . But it would be safe to say
that no one can accuse the ALES of leaning over backward to pre-
sent both sides of the "great debate" on foreign policy .
Here is an extract from the 1953 Annual Report of the ALES (p . 9)
which described an ALES-CIO World Affairs Institute, a 2-week
affair at Haven Hill Lodge, north of Detroit, Mich .
The study program will be developed around these topics : World Popula-
tion and Food ; the U . N. and Its Specialized Agencies ; the Economics of Foreign
Trade ; Comparative Labor Movements ; the Role of the CIO in World Affairs ;
How Foreign Policy Is Made . Throughout the course there will be considera-
tion of how attitudes are formed and of educational methods for local work .
Among those who will serve as faculty and discussion leaders will be : Isidor
Lubin, former United States Representative on the Economic and Social Coun-
cil of the U . N. ; Victor Reuther, assistant to Walter Reuther, president of the
CIO ; James Calderwood, associate professor of economics at Ohio State Univer-
sity (now on leave) ; Stanley H . Ruttenberg, CIO director of education and re-
search ; and Paul Nitze, former Chief of the Policy Planning Board in the State
Department . These will be supplemented by staff and officials from the United
States Labor Department, the ILO, and UNESCO ; delegates from foreign coun-
tries, including Sweden, Germany, Haiti, Tunisia, the Philippines, and New
Zealand ; trade union leaders with experience in Latin America, Europe, the
Middle East, and the Far East .
ALES also runs a Philadelphia center for leadership training in
world affairs. On page 6 of the 1953 annual report it is noted
A variety of techniques are used : discussion groups, classes, institutes, con-
ferences, film discussion, planning sessions, board and committee meetings, mem-
bership meetings . It is true here, as in all parts of the ALES international
project, that the study of world affairs has covered many topics including, for
example, foreign trade, economic aid,' labor movements abroad, and world
economic conditions.
During the period of the Philadelphia project, the study groups on the U . N . and
the U . N . trips have increased in number and have proved effective in broadening
international outlook and sense of responsibility . Preparations for the trips
include always a review of the general purposes of the U . N ., the issues under dis-
cussion, the foreign policy of this country and its position on current U . N . issues,
and a briefing or film about the nation whose delegates the group is to meet .
The work of special agencies always is emphasized, particularly the Social and
Economic Council, the Trusteeship Council, and UNICEF . There always is keen
interest in underdeveloped countries .
ALES sponsors a number of short, regional conferences throughout
the year. In 1952 it organized a Second Annual North Dakota Confer-
ence of Farmers and Workers. Delegates from unions, farm organ-
izations, and cooperatives discussed goals and methods of economic
action by organized farmers and organized workers (p . 7, 1953 annual
report) .
According to the same annual report (p . 7)

Discussion moved from everyday problems of farmers and workers-the effects
of price supports, the need for organization, opportunities for joint farmer-labor
action-to such questions as the needs of underdeveloped countries, the im-
portance of foreign trade, and the relationships between foreign aid and military
purposes.
Other excerpts from the 1953 annual report which indicate the
nature and scope of the ALES activity include these
Since the curriculum and study programs relate to the many-sided interests of
adult workers with special reference to their economic and social outlook, ALES
also has cooperative relationships with many types of educational, governmental,
and community agencies (p . 14) .
In its work with organizations outside the labor movement, ALES serves as a
bridge between labor education organizations and many community and educa-
tional bodies (p . 14) .
It goes without saying that the ALES international project has worked in
many ways with community and governmental organizations chiefly concerned
with world affairs and foreign policy (p . 14) .
Cooperative relationships of great educational value to the ALES program
have been developed with members of the Secretariat and the delegations at the
United Nations (p . 14) .
On the local level, ALES works constantly with such organizations as the
American Association for the United Nations * * * (p . 14) .
* * * the entire ALES program may be described as leadership training, since
it is planned for those who carry responsibilities within the labor movement-
union officers, committee chairmen, shop stewards, delegates, and others (p . 14) .
As a national agency giving service to a great variety of groups concerned with
labor education in this country, it has become the accepted function of ALES to
carry extensive responsibilities for interpreting labor education to friends, critics,
and the uninformed (p . 13) . [Italics ours .]
Cooperation also is extended to student bodies and to social and community
agencies . Board and staff members of ALES serve on the committees of these
organizations * * * (p.13) .
In recent years, ALES has given special attention to areas of work where the
labor movement believes that, through education, responsible action might be
strengthened (p .1) . [Italics ours,]
Our work with foreign trade unionists has included helping to plan programs ;
to make contacts ; and to utilize the skills of unionists from 33 * * * widely
scattered countries * * * . Among the visitors have been experienced labor edu-
cators, teachers, in labor schools, officers of trade unions, and government de-
partment and adult education personnel concerned in labor education (p . 1) .
In carrying out its exchange activities, ALES cooperates with various organ-
izations, among them the Institute of International Education, UNESCO, the
National Social Welfare Assembly * * * (p . 1) .
ALES * * * itself sponsors foreign trade union visitors * * * ALES extends
opportunities to American workers to study abroad * * * (p . 2) .
The ALES director and certain members of the board now serve as members
of the National Selection Committee on Workers' and Adult Education ; of the
American Selection Committee for Ruskin College Scholarships (both of the Insti-
tute of International Education) ; and of the Advisory Selection Committee for
Workers' Education of the Conference Board of the Associated Research Coun-
cil's Committee on International Exchange of Persons (p . 2) .
With every passing year it becomes more urgent for white-collar workers to
face their economic realities and to establish their rightful place in the labor
movement * * * . This is the challenge that White Collar Workshops sets out
to meet through its unique resident labor school planned to serve these work-
ers * * * (p.11) .
White Collar Workshops this year planned a shorter school-1 week-where
intensive work could be carried on, focused on a common concern . The em-
phasis throughout the week was on how white-collar workers themselves, as citi-
zens and trade unionists, can make themselves felt in the local and national
scene (p .12) .
The study program included an analysis of the factors affecting the business
cycle, with special reference to the current situation ; the economics of collective
bargaining ; the legislative and political scene in Washington ; with special em-


phasi8 on legislative and community action carried on by organized labor ; and
discussions of the significance and the social attitudes of white-collar workers .
There was also a series of workshops, highlighted by a stimulating panel on
organizing and strengthening white-collar unions in which union staff members,
experienced in handling the problems of white-collar workers, participated
(p . 12) . [Italics ours .]
By its own admission, therefore, ALES is in the center of a network
of educational groups, many of whose activities border on propaganda
and political action . ALES is in a position to make its impact felt on
a wide front by virtue of its staffing of interlocking directorates . It
feels that a legitimate function is to convince white-collar workers that
they should join in economic and political action with unionists . It
outlines the legislative terrain in Washington and trains troops for the
battle.
It would appear that ALES relates education to action favored by
the labor movement. It interprets the meaning of education to the
general public. It staffs the committees of student groups and social
agencies. It provides the funds for a two-way transmission belt that
carries American trade unionists to Socialist Europe and brings
Socialist leaders here. It serves as a bridge between many govern-
mental agencies and community groups interested in world affairs . It
trains the leadership of the labor movement, and that leadership, of
course, has a great responsibility for planning and implementing
political action .
In 1938, ALES published for sale a 45-page pamphlet entitled
"Annotated List of Pamphlet Material for Workers Classes ." While
this pamplet is now 16 years old, it should be noted that it contains a
foreword by Eleanor G . Coit, the then and now director of ALES . In
addition, the sections on The Labor Movement, Labor Economics,
English and On Methods and Materials were prepared by Orlie Pell,
who is still listed on the ALES staff as the publications and research
associate . In reading ALES' own description of the contents of some
of the books which it recommends for use in workers' classes and in
also considering the organizations which sponsored the publication of
such books, one seriously questions how education is served and rather
asks oneself why tax exempt moneys should be used to further class
hatred, social unrest, and economic warfare . One of the books recom-
mended is entitled "Toward a Farmer-Labor Party" written by Harry
W . Laidler, and published by the League for Industrial Democracy,
of which he is the executive director . As stated by ALES, this book
contains :
A brief analysis of the problems confronting an independent Farmer-Labor
Party in America, and an account of past and present developments in that di-
rection. Labor party movements in Minnesota, Wisconsin, New Year, Illinois,
Detroit, Pennsylvania, California, and Oregon included.
On the question of regulating labor unions, the recommended book
is Should Labor Unions be Regulated? by Hubert Herring and Harold
0. Hatcher, published by the Council for Social Action . Arguments
for and against compulsory incorporation of trade unions are con-
tained in this volume "with conclusion in favor of the negative" as
described by ALES .
Another'book entitled "Shall Strikes Be Outlawed? " by Joel Seid-
man, and published by the League for Industrial Democracy, deals
with "discussion of compulsory arbitration of labor disputes, its dan-

gers to workers in countries where labor is politically weak, and ex-

periments in compulsory arbitration here and abroad ."
Another book published by the League for Industrial Democracy
and written by Carl Raushenbush is entitled "Eordism", and is rec-
ommended by ALES as being "useful for workers' classes in showing
concretely some of the methods used to combat organization among
workers, and some of the influences a large company can have on the
surrounding community ."
The ALES pamphlet also contains a bibliography of labor plays,
some of which deserve special mention . For instance, two plays spon-
sored by the Highlander Folk School (referred to in appendix IX as
a revolutionary theater organization) are Gumbo where racial and
antiunion discrimination is depicted and Labor Spy which "shows
methods used by antiunion detective agency to `hook' an innocent
worker into being a labor spy ."
. Many plays are recommended which were sponsored by the Brook-
wood Labor College, on which comment has already been made . For
instance, there is the play Step which is described as a "mass recita-
tion on psychology of unemployed", and Uncle Sam Wants You, the
message of which is "a reminder of what recruiting posters really ask
for . Excellent for trained speech chorus ."
Under the sponsorship of Southern Summer School, we find other
labor plays depicting "standing in line before a closed bank" in Bank
Run, and "plight of unemployed and hungry southern millworkers
in Job-Huntin', and "Southern mill strikers around a fire on a picket
line at night . Effective use of real strike songs," in On The Picket
Line .
Then there are found additional plays about labor and organization
as Black Pit by Albert Maltz (cited by House of Representatives
on October 24, 1947, for contempt of Congress) which ALES describes
as follows
A miner, framed because of union activity, after coming out of jail, attempts
to find work but is blacklisted everywhere because of union record . Is driven to
accept position as stool pigeon. . Requires convincing use of Slavic dialect and
intelligent direction .
A play which has been particularly marked "recommended" b,Y
ALES is Rehearsal by Albert Maltz, which revolves around the fol-
lowing situation
During a rehearsal of a stirring mass chant on the Detroit auto strike, one
actress finally succeeds in playing the part with almost too much realism . Excel-
lent drama ; one rich emotional part .
Also winning the highly recommended award is Waiting for Lefty
by Clifford Odets, described as : "One of the best plays for labor and
leftwing groups . Realistic treatment of strikes, rackets, and stool
pigeons . Requires intelligent directing ."
Also recommended is The Maker of Swords by Sterling Olmsted,
described as follows
Fantasy laid in imaginary country . A maker of swords has become fabulously
rich through selling his product and then stirring up international hatred to the
point of war . Caught and convicted of his crimes, he is condemned to die but
cleverly plants the seeds of mistrust in the hearts of his keepers, two brother
princes, who in their turn declare war against each other, and each secretly or-
ders more swords from the swordmaker . Play ends on ironic note, with no solu-
tion offered .


Classified under the category "fantasy and satire" is 4 play, Blocks,
by Mollie Day Thatcher, and sponsored by Vassar Experimental
Theater, which is :
A powerful satire in which Green Worker and Tan Worker symbolize all the .
masses forced unwillingly to war, while the Green Man and the Tan Man sym-
bolize all the leaders, generals, and capitalists making war without engaging
in it.
Finally, ALES refers to two plays from Soviet Russia, one being
Bread by Vladimir Kirshom, and described as "the best known and
most significant Soviet play of the gigantic effort to change the life
and economic organization of the Russian peasantry ."
In 1942, ALES published and distributed a pamphlet entitled
"Songs Useful for Workers' Groups," which is hoped "would be
helpful to groups of workers who want to sing together ."
Among the song collections listed in said pamphlet was the fol-
lowing
Rebel Song Book, compiled and edited by Samuel H . Friedman ; music editor,
Dorothy Bachman . Rand School Press, 7 East 15th St ., New York . Paper .
92 pages. 50 cents.
"87 Socialist and Labor Songs," including a number of revolutionary songs
translated from the Russian German, Finnish, Italian, and so on . Also, union
and organzing songs, IWW and strike songs . In most cases the text is set
to old familiar melodies, but there is also some stirring original music by Hanns
Eisler, Herman Epstein, Liebich, and others . The songs are well adapted for
mass singing in unison, with moderately easy accompaniments .
Certainly the question arises whether a tax-exempt fund should be
used to further the sale and use of a rebel song book which contains
among other things organizing songs, IWW and strike songs, many
of which are set to the "stirring original music by Hanns Eisler ."
ALES distributes a reprint of a symposium on Some Trends in
Adult Education, originally published in the November 1952 issue
of Adult Education, an organ of the Adult Education Association of
the United States of America . Eleanor G . Coit, director, and Orlie
A. H . Pell, education and research associate of ALES, took part in
the symposium.
It was pointed out by the two ALES participants that labor edu-
cation is no longer a frill but "well on the way to being considered
an integral part of the process of building a strong, effective labor
movement." The reasons why labor education is changing from a
utilitarian approach, with emphasis on techniques, to the kind of edu-
cation appropriate for successful political action were clearly pointed
out :
As our lives in the 20th century become more complex and interdependent,
unions are finding themselves concerned with a wider range of problems . Less
and less is collective bargaining with the employer a fully adequate answer to
their needs ; price levels that affect their standard of living, the housing condi-
tions under which they live, the effects of the cold war, the atmosphere of
loyalty oaths and suspicion-these problems can be met only with action on the
community, national and international scenes (p . 2) . (Italics ours.)
Consequently labor education has increased the scope of its responsibility .
The study program for example, of the 1952 union summer institutes held in
all parts of the country, includes among their areas of work such fields as inter-
national affairs (including point 4), wage stabilization, community services,
human relations, political action, public relations, and civic rights * * * (p . 2) .
One of the outstanding developments of recent years has been the increased
involvement in international affairs on the part of labor leaders (p . 2) .
ALES staff members would seem to be preoccupied with the abso-

lute necessity of promoting worldwide labor action .
As we look to the future, we see, perhaps, an intensification of the trend al-
ready apparent . A sober, responsible labor movement, aware of its increasing
responsibilities in a world at crisis, turning to its educational arm for help in
meeting its responsibilities ; seeking to understand the problems faced on the
community, the national, and above all, the international levels . Here may lie
the direction of growth during the coming years * * * so that the labor move-
ment may take the lead in the development of insight and action that will be
worldwide in scope (p . 3) .
Irvine L . H. Kerrison, chairman, labor program, Institute of Man-
agement and Labor Relations, Rutgers University, took part in the
same symposium . Here is his concept of "successful" labor education
at the university level, as set forth in the reprint circulated by ALES
Institutions of higher learning now achieving the greatest success in workers'
education * * * believe that effective workers' education helps the worker be-
come a better individual, a contributing member of his union group, and a par-
ticipating citizen in his community . They base all their work with unions on
three operating principles
(1) Every activity planned jointly by the union and the university .
(2) Every activity designed to deal with individual problems of union
groups requesting service .
(3) Close cooperation with the labor movement maintained through union
advisory committee members and regular consultation with National, regional,
and State union education directors
University officials, in these troubled times, are fond of extolling aca-
demic freedom and the right of scholars to teach the facts without
fear or favor, pressure or censorship . Yet, in the field of labor edu-
cation, it would seem that union leaders exercise the right of veto and
the privilege of constant consultation . Mr . Kerrison, the author of
this concept of controlled education, then asserts that
* * * organized labor is one of the few bulwarks, and perhaps strongest of the
few, against a violent dropping of the Iron Curtain on modern civilization (pp .
4-5) .
Larry Rogin, vice-chairman and a director of ALES, and a director
of the education department, Textile Workers Union of America,
also participated at the symposium and emphasized the point that
the purpose of labor "education" is to make a good union man
To the extent that the educational needs and desires of workers are more
widely met, the workers will become more effective trade unionists and better
citizens of their country and of the world (p . 6) .
Mr. Rogin raises another question which may be central to labor
education
Finally, in these days of Taft-Hartley and McCarthy and Zell, will the educa-
tor stand up for the right to deal with controversial subjects honestly and with-
out fear? From how many subjects will he beg off, saying, "This is a job for the
union?" (p .6) .
Another project of the ALES is the holding of conferences which
promote Farmer-Labor Understanding-And Action (the title of a
reprint from the Journal of Educational Sociology, February, 1952,
which is currently circulated by ALES) . The author noted that some
of the following were points agreed upon by a joint committee at the
1951 Northwest Farmers' and Workers' Education Conference
The official publications of people's organizations such as labor unions, cooper-
atives, and farmer organizations are important instruments for translating the
common agreements of educational conferences into better rank-and-file under-

TAX-EXEMPT FOUNDATIONS 11.67

standing * * * In recent years nearly all labor papers have protected the work-
ing farm families from legislative attack (by powerful exploiting interests) on
their price-support program by showing urban consumers that working farmers
get a veiy small percentage of the dollar paid by the consumer for food and
clothing (p . 5) .
Cooperative publications and Farmers Union papers have carried the story to
farmers about the very small percentage of the price of farm machinery and
supplies which goes to the worker in the form of wages . These same publica-
tions have informmed farmers of the basic threat, not only to organized labor
but to organized farmers, in such legislation as the Taft-Hartley Act (p . 5) .
As an example of substantial "interlock" it might be pointer out
that the vice chairman of the American Labor Education Service,
Mark Starr, has also been a chairman of the board of the League for
Industrial Democracy . Further, he is the director of education for
the ILGWU and a member of the United States Advisory Commission
on Educational Exchange. He has been appointed to responsible
policy positions in the field of education : as labor consultant to tha
Office of War Administration ; as a member of the American delega-
tion to establish UNESCO ; as a labor education consultant to Ameri-
can military government in Japan ; as a member of President Truman's
Commission on Higher Education during the period 1945-47 .
Mr . Starr is also listed as chairman of the board of the Public Affairs
Committee which publishes a great many pamphlets on significant
topics of the day . In view of his prominence in the field of educa-
tion and his position as a key link in the interlocking directorate of
certain groups whose activities border on propaganda and political
action, it is perhaps desirable to examine his philosophy of education
in some detail . Following are excerpts from Labor Looks at Educa-
tion by Mark Starr, published by the League for Industrial Democracy
in 1947
Later they (the poor) read Marx and Veblen, to name only two of the most
effective intellectual commandos who utilized their own college training as
bombs to blast away the intellectual girders supporting the modern economic
system . Inevitably such individuals are rejected as heretics because the ideas
which they espouse do not support things as they are (p . 4) .
This passage is characteristic of Mark Starr and his associates in
ALES who regard education as a weapon which should be used to de-
stroy the foundations of the present social order . Certainly he had in
mind the use of education as a weapon in what Socialists love to refer
to as the class struggle when he wrote
The labor movement cannot rest content until there are 30 million people or-
ganized in the trade unions of the United States . This means that workers' edu-
cation should keep in mind the conversion of the community to labor's point of
view.
(See Mark Starr's article entitled "Worker's Education, 1900-1940,"
published in May-June 1940 issue of the Workmen's Circle Call) .
Note in the following passage Mr . Starr's contempt for the dis-
passionate search after truth . To him, education is propaganda-
there is no distinction.
Some educators endeavor to satisfy their consciences by suggesting that edu-
cation with an aim is propaganda and that true education deals only in immut-
able, unalterable, fundamental truths, as if abstract ideals could be isolated from
their daily changing content . After all, there is only a relative distinction be-
tween education and propaganda . Your education is always propaganda to the
other fellow (p. 5) .
A new philosophy of education is striving to be born-a planned community to
replace the jerry-built dwellings produced by the haphazard efforts of the past
(p.10) .
49720-54-pt . 2 15
The "planned community" of thought is the lever which can

help build the cooperative commonwealth whose highest ideal is
"group -think" The "haphazard, jerry-built dwellings of the past"
housed Plato, Aristotle, Thomas Aquinas, Milton, Dante, Chaucer,
Tolstoy, Newton, Darwin, Emerson, Edison, Locke, Hume, Kent,
Luther, and a handful of others whose contributions to civilization
should not be overlooked in the new passion for the intellectual
collective .
Mr . Starr whose own projects have been heavily subsidized by the
Ford Foundation's fund for adult education, has a few words to say
about foundations and their work . He leaves no doubt that the busi-
ness of education is to change society .
One factor in influencing the relation of colleges and universities to labor and
to the type of education which would facilitate necessary social changes by con-
sent, is the role of the foundations . Educational activity in the United States
cannot be fully studied without evaluating the effects of the foundations thereon
(p . 11) .
But colleges too often have to go cap in hand and exploit personal contacts
with the uncrowned kings and agents of philanthropy * * * . There are, of
course, some foundations which delouse effectively the millions accumulated by
monopolies and dynastic fortunes ; but if one could choose a way for the long-time
support of education, it would be done by community intelligence rather than the
caprice of the big shots of big business who wish to perpetuate their names in a
spectacular fashion, a process which may not in all cases coincide with the real
educational activity of the college (p.12) .
Mr . Starr constantly reverts to the premise of "progressive" edu-
cation-that the school should build a new social order .
Our frame of reference needs revision . Can the school help us to meet the
changed world? Perverted and misused in the past, education can be a cure for
many social ills and labor can help to make it so . Labor's consistent support of
education in the past and its role as the largest organized unit of parents gives
it the right to speak in constructive criticism (p . 14) .
Mr. Starr defines "workers' education" in a way which suggests that
it is almost equivalent to "political action ."
At its best, workers' education serves simultaneously as a discipline, a direc-
tive, and a dynamic force to labor organizations . It emphasizes the study of
group problems to the end of group action for their solution (p . 22) .
The CIO department of education and research undertakes extensive activity
in public relations among religious, educational, and civic groups in addition to
education for its own membership . Its activity heads up politically into the
political action committee * * * over 500 labor papers, and other publications
ranging from first readers, colored comics, striking posters, and lively leaflets
to ponderous tomes of union history and research use the printed word as an
agency for education and propaganda (p. 23) .
Mr. Starr urges that the public schools be used to sell the concept
of the closed shop
Permit me to make some specific suggestions on what schools and textbooks
should say about trade unionism
(1) They should give an explanation of the "closed shop" and the "union
shop" to show that they are no more tyrannical or unfair than our system of
public taxation under which the individual cannot escape his contribution to the
public revenues from which he benefits * * * (p. 37) .
(2) The school and the textbook should be at pains to describe the actual
functions of trade unions in improving the wages, hours, working condi-
tions * * *

TAX-EXEMPT FOUNDATIONS 11 .69

Teachers in high schools and elsewhere should be able to see behind the head-
lines of newspapers which report strikes on page 1 and their settlement on page
20, if at all . They should be able to understand the "lusty immaturity" of unions
originating in the New Deal decade, which had to fight bitterly to keep alive in
previous years * * * (p . 38) .
(3) Textbooks-should also let the facts of experience speak concerning the
results of technological unemployment-and also the effects of the centraliza-
tion of power in the hands of the banks and the big corporations, with the re-
sulting dangers of monopoly prices as well as unemployment .
(4) The textbooks and the school should also examine carefully the role
played by the middleman and the speculator, who often escape the censure which
falls on high wages as an alleged cause of high prices (p . 39) .
Finally, it would appear that political science and civics classes are
to indoctrinate students with the notion that labor unions and their
leaders have a monopoly on patriotism, while Congress, business, and
everbody else are selfish .
Teachers should currently help their students to see the real factors behind
the industrial unrest and strikes of 1946, namely, the strain of overwork and the ,
accumulated grievances unexpressed, for patriotic reasons, in wartime ; the dis-
appointment of the unions because Congress failed to act in * * * securing
full employment ; and the indignation against * * * huge wartime profits (pp .
41-42) .
Another important member of the ALES board of directors was
Hilda W. Smith, who, like Starr, has played an important role in
labor movements . She has been referred to on pages 565 and 703 of the
Dies committee report as an endorser of Brookwood Labor College,
which was finally disavowed by the A . F . of L . because of its commu-
nistic activities . Hilda Smith also served as a member of the advisory
committee of Commonwealth College of Mena, Ark . (cited in
Attorney General's list) which was finally closed by the State legis-
lature because of its questionable practices . She is also listed in vol-
ume 10, page 6404, of the House committee report on Un-American
activities, and a member of American League for Peace and Democ-
racy, which was branded as a Communist-front organization by the
Government.
We respectfully submit that the activities of ALES, spearheaded as
they have been by such dynamic persons as Mark Starr and Hilda W.
Smith, raise a serious question whether they have not gone far beyond
the ordinary field of education, and is actually engaged in political
propaganda.
Submitted herewith, with the request that they be deemed part of
the record, are the following documents issued or published by ALES
1. Invitation for conference on February 25-26, 1950 .
2. Letter to members, October 2, 1946 .
3. Invitation for conference on November 1-2, 1947 .
4. Letter to members, January 30, 1948 .
5. Letter to members, June 4, 1948 .
6. Tentative program for conference on November 13-14, 1948.
7. Annual report, 1953.
8. Annotated list of pamphlet material for workers' classes.
9. Pamphlet entitled "Songs Useful for Workers' Groups ."
1170 TAX-EXEMPT FOUNDATIONS '
EXHIBIT 1-CITATIONS
ELEANOR COPENHAVER ANDERSON OR MRS. SHERWOOD ANDERSON
DIES COMMITTEE
(Listed as Eleanor Copenhaver)
Page
Brookwood College (endorser) 565,703
American Friends of Spanish Democracy (executive committee) 568
(Listed as Mrs . Sherwood Anderson)
National Citizens' Political Action Committee (member) 10298
Shown as having belonged to one organization which the Attorney General
has characterized as subversive or Communist 10301
American League Against War and Fascism 10304
Shown as having been connected with a Communist front for farmers, con-
sumers, unemployed, and social and economic legislation 10341
Shown as having been connected with two Communist fronts on war, peace,
and .foreign relations 10345
Shown as having been connected with a Communist front for youth and
education 10346
Shown as having been connected with a Communist front in the miscel-
laneous field 10347
Shown with a total of five front organizations (listed above) 10348
TESTIMONY OF WALTER S . STEELE REGARDING COMMUNIST ACTIV-
ITIES IN THE UNITED STATES-HEARINGS BEFORE THE HOUSE
UN-AMERICAN ACTIVITIES COMMITTEE, JULY 21, 1947
National Council of American-Soviet Friendship-call to a conference on
women of the United States of America and the U . S . S . R . in the
postwar world, held on November 18, 1944 (sponsor) 83
(Listed as Eleanor Copenhaver)
APPENDIX IX
American Friends of Spanish Democracy (executive committee) 380
American League Against War and Fascism (national executive com-
mittee) 416
National Committee for the Defense of Political Prisoners 1176
National Committee for People's Rights 1179
National Religion and Labor Foundation 1304
Nonpartisan Committee for the Reelection of Congressman Vito Marcan-
tonio (committee member) 1375
Student Congress Against War (national committee) 1620
(Listed as Elinore Coper haver)
Committee To Aid the Striking Fleischer Artists 1774
(Listed as Mrs . Sherwood Anderson)
National Citizens' Political Action Committee 263
American Committee for Democracy and Intellectual Freedom (spon-
sor) 323, 334
International Women's Congress Against War and Fascism 848
The League of Women's Shoppers, Inc . (sponsor) 1009
National Committee To Abolish the Poll Tax (sponsor) 1168
People's Institute of Applied Religion 1463
(Listed as Eleanor C . Anderson)
People's Institute of Applied Religion 1470
(Listed as Eleanor Copenhaver Anderson)
Conference on Constitutional Liberties (sponsor) 653
Consumers National Federation (sponsor) 659
Coordinating Committee To Lift the Embargo (representative individual) - 670
Council for Pan American Democracy (sponsor) 675
National Federation for Constitutional Liberties (sponsor) 1228


EXHIBIT 1-CITATIONS-Continued
MAX LERNER
DIES COMMITTEE
Pat.
American Friends of Spanish Democracy (committee) 56&
National Citizens' Political Action Committee, Max Lerner, author, editor,
PM, New York 10299,
Shown as having been connected with six organizations which the Attorney
General has characterized as subversive and Communist 10301
American League for Peace and Democracy 10304
Citizens Committee to Free Earl Browder, Communist Party, statements
defending 10305
League of American Writers, Michigan Civil Rights Federation, National
Federation for Constitutional Liberties 10306
NEW MASSES
"* * * Max Lerner, one of the editors of the newspaper, PM, and also a
radio broadcaster for Sante Cream Cheese, has a total of 26 affiliations,
covering every category listed here 10332
Shown as connected with two Communist fronts dealing with racial,
refugee, and alien questions 10340
Shown as connected with four Communist fronts for defense, support, or
honoring of avowed Communists 10341
Shown as connected with two Communist fronts for farmers, consumers,
unemployed, and social and economic legislation 10342
Shown as connected with three Communist fronts for legal defense and civil
rights. Also shown as connected with two Communist fronts for pro-
fessional groups 10343
Shown as connected with three Communist fronts on the Spanish Civil
War 10344
Shown as connected with three Communist fronts for support or praise of
the Soviet Union . Also shown as connected with two Communist fronts
on war, peace, and foreign relations 10345
Shown as connected with two Communist fronts for youth and education- 10346
Shown as connected with one Communist magazine, book or other litera-
ture . Also shown as connected with two miscellaneous Communist
fronts 10347
APPENDIX IX
Allied Voters Against Coudert (sponsor) 316
American Committee for Anti-Nazi German Seaman 319
American Committee for Democracy and Intellectual Freedom, signatory
to petition to discontinue the Dies committee "Max Lerner, professor,
Williams College"-_
-- 322
American Committee for Protection of Foreign Born :
Guest of honor 347
Sponsor-- - 350
American Friends of the Soviet Union 379
American Friends of Spanish Democracy (sponsor) 380-382
American Investors Union, Inc . (sponsor), "Max Lerner, professor of
political science, Williams College" 388
American League for Peace and Democracy (signatory) 392, 411
Golden Book of American Friendship With the Soviet Union (signatory),
project of the American Friends of the Soviet Union 461, 467, 771
Russian War Relief, Inc 476
American Youth Congress (endorser) "Max Lerner editor the Nation"_ 548
Appeal for Pardon of German Communist (Robert Stamm) (signatory)-_- 571
Ben Leider Memorial Fund (committee member) 585
Citizens Committee for Harry Bridges, "Dr . Max Lerner, Williams
College" 599
Citizens Committee To Free Earl Browcfer, "Prof . Max Lerner, Williams
College" 619,621
EXHIBIT •1-CITATIONS-Continued
Page
Communist Party, statement defending "Max Lerner, Massachusetts"--- 649
Consumers National Federation (sponsor) 659
Coordinating Committee To Lift the Embargo (representative individual) - 668
Conference for Pan American Democracy (sponsor) 673
Frontier Films (advisory board) 732
Michigan Civil Rights Federation (speaker) 1058-1059
Supporters .of Anti-Nazi Seamen (sponsor) 1152
National Emergency Conference (signatory) 1206
National Emergency Conference for Democratic Rights (board of spon-
sors) 1210
Non-Partisan Committee for the Reelection of Congressman Vito Mar-
cantonio (committee member) 1375
Open Letter to American Liberals (signatory) "Max Lerner, editor, The
Nation" 1379
Open letter for closer cooperation with the Soviet Union (signatory)
"Prof. Max Lerner, Professor of Government, Williams College" 1384
Prestes defense (signatory) "Max Lerner, editor, The Nation 1474
Soviet Russia Today, a party-line publication (contributor) 1603
J . RAYMOND WALSH
Twentieth Century Fund, Committee on Cartels and Monopoly
DIES COMMITTEE
TESTIMONY OF ROBERT E . STRIPLING, CHIEF INVESTIGATOR, SPECIAL COMMITTEE

TO INVESTIGATE UN-AMERICAN ACTIVITIES
"* * * Mr . Chairman, it is interesting to note that the largest contribu-
tors, according to the tabulation filed with the Clerk of the House, are
officials of the Political Action Committee themselves . For instance,
J . Raymond Walsh, who is research director of the organization, con-
tributed $4,750 10231
`Mr . MATTHEWS . * * * here is the name of James H . McGill, who con-
tributed $2,000. Mr. McGill, according to Sidney Hillman's list pre-
sented to the campaign expenditures committee, is a manufacturer in
Valparaiso, Ind . In the early postwar days of World War I, two men
who are now members of the National Citizens Political Action Com-
mittee, one of whom is McGill, signed a contract with the Russian Red
Cross, stating in the contract that it was done because of prejudice
against the Communist regime in Russia 10232
"Mr . McGill was one of the signers of this particular contract . His organ-
ization, the American subsidiary, began to raise funds for the relief of the
destitute in Russia, but according to the record, at the time, the organi-
zation immediately degenerated into a political propaganda machine,
and Mr . McGill and one other who will be named tomorrow, who signed
that contract, were associated with an organization which put out the
statement : `We will milk the American bourgeoise in order to destroy
it .' That is in the record of some 25 years ago .
"Mr . THOMAS . How much did he contribute?
"Mr . MATTHEWS . $2,000 .
"Mr . THOMAS . Anyone else .
"Mr . Matthews . J. Raymond Walsh has quite a Communist record . He
contributed $4,750 ."
"Mr . STRIPLING . Mr. Chairman would it be agreeable to make this list of
contributors a part of the record? 10233
"Mr . COSTELLO . Yes ; I think that should be in the record .
"Congress of Industrial Organizations Political Action Committee In-
dividual contributions account-Loans, July 23-Sept . 9, 1944 .
"J . Raymond Walsh, New York, N . Y ., $4,750 .
STATEMENT OF J . B . - MATTHEWS, RESEARCH DIRECTOR, SPECIAL COMMITTEE
To INVESTIGATE UN-AMERICAN ACTIVITIES
Page
"Mr . MATTHEWS * * * I offer a list of the 25 organizations (which the
Attorney General has characterized as subversive and Communist),
followed by a list of the 82 individuals, who have been affiliated with
them * * * J . Raymond Walsh, 2 10302
League of American Writers, National Federation for Constitutional
Liberties 10306
J. Raymond Walsh is listed as having been connected with one Communist
front dealing with racial, refugee, and alien questions 10340
J . Raymond Walsh is listed as having been connected with three Com-
munist fronts for legal defense and civil rights 10343
J . Raymond Walsh is listed as having been connected with one Communist
front for professional groups .
J . Raymond Walsh is listed as having been connected with one Communist
front for support or praise of the Soviet Union 10345
J . Raymond Wash is listed as having been connected with one Communist
front on war peace, and foreign relations .
J . Raymond V'alsh is listed as having been connected with one Communist
front for youth and education 10346
J . Raymond Walsh is shown with a total of eight citations 10349
APPENDIX IX
American Committee for Protection of Foreign Born (sponsor) 340, 354
American Council on Soviet Relations (signatory of open letter to the
United States urging a declaration of war on the Finnish Government
in the interests of speedy victory by the United Nations over Nazi
Germany and its Fascist allies) 370
American Student Union 514
Council for Pan-American Democracy (executive committee) 672, 674
Interprofessional Association for Social Insurance (chairman of open
forum meeting) 915, 921
League of American Writers 967, 978
Statement in defense of the Bill of Rights (signatory) 1126
National Emergency Conference (signatory) 1205, 1207
National Emergency Conference for Democratic Rights (executive com-
mittee) 1209, 1210
National Federation for Constitutional Liberties 1222
Open letter for closer cooperation with the Soviet Union (signatory) - 1381, 1384
APPENDIX V
Open letter calling for greater unity of antifascist forces and strengthening
of the front against aggression through closer cooperation with the Soviet
Union (signatory) 1681
TESTIMONY OF WALTER S . STEELE, JULY 21, 1947
"A World Armenian Congress was held in New York City in May 1947 .
In attendance were delegates representing 3I/ million Armenians in
26 countries. The Congress condemned the Truman doctrines in
foreign affairs . Speakers included S . Edwin Smith of the National
Council of American-Soviet Friendship, John Roy Carlson, and J . Ray-
mond Walsh of Friends of Democracy" 135
"Frank Kingdon and Jo Davidson were selected cochairmen of Progressive
Citizens of America, each having previously served as cochairman of
two of the major merging groups . Both have extensive front back-
grounds . Herman Shumlin, who has a record-breaking background of
front activities, was elected secretary . Michael M . Nisselson, with
some 12 Red-front affiliations, was chosen treasurer . Executive vice
chairmen are C . B . Baldwin and Hannah Dorner . Both have partici-
pated in Red-front activities in the past. Vice chairmen are * * * J .
Raymond Walsh" 148
Page
"As an example of the manner in which Red fronters operate through Pro-
gressive Citizens of America, I call attention to the 22 simultaneous
public protest meetings held in New York City earlier this year in an
attempt to `stop antilabor legislation .' The meetings were under the
auspices of the movement . Speakers at these meetings included Nor-
man Corwin, Dorothy Parker, Olin Downes, William S . Gailmor, Elinor
S . Gimbel, Frank Kingdon, Canada Lee, Lillian Hellman, Dwight
Bradley, Dean Dixon, Henry Pratt Fairchild, Goodwin Watson, Alfred
Stern, and J . Raymond Walsh 149
REPORT ON SOUTHERN CONFERENCE FOR HUMAN WELFARE
(JUNE 12, 1947)
4`J . Raymond Walsh, a frank apologist for the Communist line, according
to Prof. John H . Childs of Columbia University, speaking for the
Southern Conference in Washington, flayed President Truman's foreign
policy in Greece anFl Turkey 10
J . Raymond Walsh i$ shown being affiliated with statement defending
Communist Party, December 14, 1939 ; American Committee for Pro-
tection of Foreign Born ; National Federation for Civil Liberties ; and
American Committee for Soviet Relations 15
REVIEW OF THE SCIENTIFIC AND CULTURAL CONFERENCE FOR WORLD
PEACE ARRANGED BY THE NATIONAL COUNCIL OF THE ARTS, SCIENCES
AND PROFESSIONS (H . REPT 1954-APRIL 19, 1949)
"The Win-the-Peace Conference (Congress) was expanded into the move-
ment behind the candidacy of Henry A . Wallace for President, which
crystallized into the Progressive Citizens of America and the Progressive
Party 8, 9
"From its inception this movement had the active approval and support
of Moscow and the Communist Party of the United States . Among the
sponsors of the New York Cultural Conference were the following
Wallace supporters * * * J . Raymond Walsh 8,9
"A tabulation of the numerous Communist-front affiliations of the spon-
sors of the Scientific and Cultural Conference for World Peace shows the
following interesting figures : 49 have been affiliated with from 11 to 20
Communist-front organizations, and include * * * J. Raymond
Walsh 17, 18
American Slav Congress 22
Committee for a Democratic Far Eastern Policy 24
National Citizens Policital Action Committee 31
Progressive Citizens of America 33
Southern Conference for Human Welfare 34
The Panel Room (forum), 13 Astor Place, New York City 36
Support of Soviet Union, miscellaneous 49
Cultural and Scientific Conference for World Peace (sponsor) 60
REPORT ON THE AMERICAN SLAV CONGRESS AND ASSOCIATED
ORGANIZATIONS (H . REPI . 1951-JUNE 26, 1949)
"Money-raising activities in behalf of Communist Yugoslavia were placed
in the hands of two outstanding leaders of the American Slav Congress,
Namely Louis Adamic and Zlatko Balokovic * * * 77-78
"The campaign was actively supported by the Daily Worker, official organ
of the Communist Party, U . S . A .
"Simultaneously it received the approval and support of the following
unions, then controlled by the Communists * * * It was further
endorsed by the following individuals with long records of affiliation with
Communist front organizations : J . Raymond Walsh * * * ."
American Slav Congress (dinner chairman) 106, 107


REPORT OF THE COMMUNIST "PEACE" OFFENSIVE
Page
Scientific and Cultural Conference for World Peace (sponsor) 106
"A tabulation of the numerous Communist-front affiliations of the sponsors
of the Scientific and Cultural Conference for World Peace shows the fol-
lowing interesting figures : 49 have been affiliated with from 11 to 20
Communist-front organizations, and include * * * J . Raymond
Walsh ." 107
EDUARD C . LINDEMAN
DIES COMMITTEE
Friends of the Soviet Union in the United States (national committee) --- 376
Mr . MATTHEWS . * * * Mr. Goff, can you identify the members of the
managing board and of the editorial board listed in Champion as members
of the Young Communist League? 5605-5606
Mr . GOFF . I can identify the managing board . . I can identify Francis
Franklin . As to the editorial board ., right offhand, I cannot say, but I
can identify, of the contributing group, Edward Strong, James Wechsler,
Angelo Herndon, Abbot Simon, Al Levitt, and there may be some others .
On the advisory committee, they have some other people who are not
Communists .
Mr . MATTHEWS . The advisory editors are also listed there, and that is a
pretty fair indication--
The CHAIRMAN (interposing) . Read the list of advisory editors .
Mr . MATTHEWS . The names listed are as follows : Senator Lynn J . Frazier,
Dr. Eduard C . Lindeman, Prof . Jerome Davis, Oswald Garrison Villard,
Frank Palmer, William Ziegner, C . Hartley Grattan, John R . Tunis,
Kenneth M . Gould, Harry Elmer Barnes, Rose Terlin, and Robert
Morss Lovett .
Mr . THOMAS . You mentioned a man named Lindeman . What are his
initials?
Mr. MATTHEWS . Eduard C . Lindeman .
Mr. THOMAS . Before you get away from that in the record, I think we
should know something about Mr . Lindeman, or what his activities are .
Do you mind bringing that up now, or will you do that a little later?
The CHAIRMAN . Does the witness know?
Mr . THOMAS . I am asking Mr . Matthews .
Mr . MATTHEW-, . I am not testifying now .
Mr . THOMAS . Will you bring that up later?
Mr . MATTHEWS . Subsequently Mr . Lindeman will be identified as on an
important committee of the national organization .
(Listed as E . C . Lindeman)
Brookwood College (endorser) 565,703
"* * * In this exhibit, I also call the attention of the committee to the 2452
record contained therein of Dr . Harold Rugge, a member of the ad-
visory committee of the Progressive Education Association, as shown in
their publication which is in evidence .
"Other members of the organization, as shown in that magazine are Mr .
Arthur E . Morgan, Mr . Alvin Johnson, Mr . E . C . Lindeman, and Mr .
Carleton Washburne, all of whom are listed in the Red Network as radi-
cal professors . * * *"
American Committee for Struggle Against War (national committee)_-__ .. 6233
Second United States Congress Against War and Fascism (national execu-
tive committee) Appendix, vol . 10, xxvii
Listed as Edward C . Lindeman)
American Youth Congress, Edward C . Lindeman, New York School of
Social Work 875
(Listed as Dr . Edward Lind .eman)
"As further evidence of the communistic character of the IPA" (Inter-
Professional Association), "there have been taken at random a record of
a few of the speakers who appeared at the meetings of this organization- 1996
Page
"Dr . Edward Lindeman, national director of the WPA recreation project
and contribution editor of the Communist weekly, New Republic * * *"
APPENDIX IX
American Committee for Anti-Nazi Literature (sponsor) 322
American Council on Soviet Relations (member) 365
American Investors Union, Inc . (sponsor) 388
American League for Peace and Democracy (sponsor) 396
American Committee for Struggle Against War 409
American Society for Cultural Relations With Russia (U . S . S . R .) (book
committee) 473
American Youth Congress :
National advisory committee 535,537
Panel member 543
Signatory 551
Citizens' Committee To Free Earl Browder (signatory) 623
Coordinating Committee To Lift the Embargo (representative individual)- 669
Greater New York Emergency Conference on Inalienable Rights (sponsor) - 776
Joint Anti-Fascist Refugee Committee (sponsor) 941
League of American Writers 977
League for Mutual Aid (advisory committee) 982
National Emergency Conference for Democratic Rights 1215
New York State Conference on National Unity 1370
Champion of Youth (party-line publication)-advisory editor 1447
Social Workers Committee to Aid Spanish Democracy (national com-
mittee) 1577
REPORT OF THE HOUSE UN-AMERIW'AN ACTIVITIES COMMITTEE ON THE
SOUTHERN CONFERENCE FOR HUMAN WELFARE-JUNE 12, 1947
Member, New York executive board 15
Other fronts also shown : Support or defense of individual Communists-
Browder. Organizations defending Communists : Joint Anti-Fascist Ref-
ugee Committee, New York Conference for Inalienable Rights . Pro-
Soviet relief or propaganda organizations : American Committee for
Soviet Relations . Organizations defending Soviet foreign policy, Ameri-
can League for Peace and Democracy .
STATEMENT FILED IN BEHALF OF THE FOREIGN POLICY

ASSOCIATION, INC .
Part II of the report entitled summary of activities of the Carnegie
Corporation, Carnegie Endowment, and Rockefeller Foundation con-
tains certain criticisms of the Foreign Policy Association . The pres-
ent statement is made in answer to these criticisms . We ask that it
be filed as part of the official records of the committee .
These criticisms or allegations are in some cases explicitly stated,
in others implied . They can be summarized as follows : (1) that under
the guise of education it has engaged in propaganda ; (2) that this
propaganda takes the form of advocating an internationalist view-
point, without attention to the "nationalist" position ; (3) that its
propaganda further favors a trend toward socialism and left win
viewpoints ; (4) that it has employed subversive individuals ; and (5~
that other individuals connected with the association, although not
actually subversive, have lacked objectivity and hold views which are
questionable .

I
Before answering these criticisms in detail we present the follow-
ing general information concerning the association
The Foreign Policy Association was founded in 1918 by a growp
of distinguished citizens who were deeply concerned over World
War I and the need to create a peaceful world. First known as the.
League of Free Nations Association, the name was changed in 1921
to the Foreign Policy Association, and the organization was incor-
porated under the laws of the State of New York in 1928 . The FPA
is a private membership organization financed by membership dues,
contributions from individuals and corporations, grants from founda-
tions, and proceeds from the sale of its literature and other services .
The purpose of the association, as set forth in its bylaws, is as
follows
The object of the Foreign Policy Association, Inc., is to promote community
organizations for world affairs education, to provide assistance to such local
organizations through a national service center and regional offices, and to
advance public understanding of foreign policy problems through national
programs and publications of a nonpartisan character based upon the principles
of freedom, justice, and democracy .
The FPA publishes material on current issues in world affairs at-
tempting always to present a balanced view . The masthead of the
foreign policy bulletin carries the statement
The Foreign Policy Association contributes to public understanding by pre-
senting a cross-section of views on world affairs . The association as an organ-
ization takes no position on international issues . Any opinions expressed in
its publications are those of the authors .
The association has a speaker's bureau to aid organizations inter-
ested in programs on world affairs . It has a pamphlet service, a film
program service, and other services of value to local community edu-
cational groups. It maintains at the present time four regional of-
fices to encourage the formation of additional community committees
or councils concerned with American foreign policy and to provide
additional service to existing group .
The first president was the Honorable James G . McDonald, sub-
sequently the first United States Ambassador to Israel . Raymond
Leslie Buell served as chief officer from 1933 to 1939, Maj . Gen. Frank
R. McCoy from 1939 to 1946, and Brooks Emeny from 1947 to 1952 .
The present head is John W . Nason, formerly president of Swarth-
more College. The names of the present board of directors are listed
in appendix A .
II
This statement is submitted as a reply to the criticisms or misinter-
pretations which appear in the report .
(1) That under the guise o f education the association has engaged in
propaganda
The distinction between propaganda and education is neither simple
nor clear-cut . Both words are loosely used in modern parlance .
As used in the income tax law, propaganda means the promulgation
of doctrines or views for the purpose of influencing legislation . Thus,
section 101 (6) of the Internal Revenue Code enumerates organiza-

tions entitled to tax exemption as follows
(6) Corporations, and any community chest, fund, or foundations, organized
and operated exclusively for religious, charitable, scientific, literary, or educa-
tional purposes, or for the prevention of cruelty to children or animals, no part
of the net earnings of which inures to the benefit of any private shareholder or
individual, and no substantial part of the activities of which is carrying on propa-
ganda, or otherwise attempting, to influence legislation .
That this is the correct construction of the section is confirmed by
the relevant provision of Income Tax Regulations 118, namely section
39.101 (6) -1 (3) which states, as one of the tests which an organization
seeking tax exemption must meet, the following
(3) It must not by any substantial part of its activities attempt to influence
legislation by propaganda or otherwise .
There is no suggestion in the report that the Foreign Policy Associa-
tion has ever attempted to influence legislation .
The report, however, is based on its own interpretation of propa-
ganda, namely, that given by Mr . Dodd in his preliminary report as
contained in the transcript for May 10, page 37
Propaganda-action having as its purpose the spread of a particular doctrine
or a specifically identifiable system of principles and we noted that in use this
word has come to infer half-truths, incomplete truths, as well as techniques
of a covert nature.
This definition breaks down into two parts . The first clause is so
general and inclusive as to become meaningless as a definition . Ac-
cording to it any intelligible set of convictions once stated becomes all
act of propaganda . This is as true of teaching in support of democ-
racy, constitutional government, free enterprise, private property,
Christian morality, scientific research, technological advances, and
public health as it is of international understanding and cooperation.
Schools, colleges, health societies, and civic organizations of many
kinds become automatically vehicles of propaganda according to the
interpretation used in the present report, and the absurdity of so wide
an extension of the term becomes at once obvious .
We submit that most, if not all, of our educational institutions on
some issues advocate a cause or take a point of view, and that the re-
quirement of complete neutrality on all controversial questions would
be a deathblow to our whole American educational system .
Take, for example, the issue of democracy versus dictatorship . The
great majority, if not all, of American colleges are run by trustees and
taught by faculty who believe in democracy and who are opposed to
dictatorship whether of the left or the right . Yet faculty lectures or
books advocating democracy and opposing dictatorship would con-
stitute propaganda according to the definition proposed by Mr . Dodd
and used in the report .
We strongly urge that it is essential to the operation of the demo-
cratic system to give every possible freedom to the presentation of con-
flicting viewpoints, in the belief and hope that as a result of that proc-
ess the American people will make wiser decisions than they would
without benefit of such information .
The second half of the definition of propaganda referring to "half
truths, incomplete truths as well as techniques of a covert nature"
comes closer to the usual meaning of the word . Under that test the
Foreign Policy Association is clearly not a propaganda organization .
The Foreign Policy Association in publishing information on for-
eign affairs makes a determined effort to avoid any half truths or in-
complete truths and to present a balanced view as stated on page 2 of
this statement. Particular effort is made to find exponents of varying
points of view . No evidence of the use of techniques of a covert na-
ture has been presented in the report, and it seems hardly necessary to
state that the association does not indulge in such devices .
(2) That this propaganda takes the form of advocating an inter-
nationalist viewpoint only, without attention to the "national-
ist" position
We desire to make two answers to this charge .
In the first place, the Foreign Policy Association has not exclu-
sively presented an internationalist point of view in its publicatious .-
As evidence we cite a few examples only . In recent issues of the
Foreign Policy Bulletin Vera Micheles Dean has written articles stat-
ing and defending the arguments against further foreign aid to Eu-
rope and summarizing the current arguments against United States
participation in the UN . Between February 15, 1953, and March 15,
1954, issues of the Bulletin have carried articles by Senator Watkins
of Utah and Senator Malone of Nevada on tariffs and trade, by Sen-
ator Bricker of Ohio on curtailing the treaty-making power, and by
Governor Lee of Utah on the United States leaving the UN .
In the second place, the Foreign Policy Association by virtue of
its title and nature has been from its founding in 1918 concerned with
the problems of American foreign policy. It has sought to make the
American people more aware of the issues involved . It has tried to
provide useful information regarding these issues . While it has pre-
sented from time to time in its publications and on its platforms views
which would variously be described as isolationist, hemispheric, or
"nationalist," the association has put major emphasis on international
understanding, cooperation, and good will as means to the development
of a peaceful and prosperous world .
(3) That its propaganda further favors a trend toward Socialist and
left-wing viewpoints
The report gives the impression by the selection of certain state-
ments that the Foreign Policy Association also supports a socialistic
or left-wing position . The only evidence offered in support of this
charge is the extensive quotation from a Headline Series booklet by
Max Lerner entitled "World of Great Powers ." Mr. Lerner is well
known for his views on the economc, social, and political issues of our
time . Many who do not agree with his position nevertheless find it
provocative and stimulating . A complete analysis of FPA publica-
tions would have revealed many instances of strong support of free
enterprise and private capital . The roster of public men who have
written for the Bulletin and the Headline Series is sufficient to dis-
credit charges of leftism or of deliberate emphasis on only one point
of view.
(4) That it has employed subversive individuals
In paragraph 2 of page 63 of the report it is stated of the Headline
Series booklets that
Many were written by persons cited to be of Communist affiliation and are
questionable in content .

1180 TAX EXEMPT, FOUNDATIONS
With respect to the first half of the above quotation, while "many"
are referred to, the only author of a headline series mentioned in the
report as possibly being a Communist is Lawrence K . Rosinger, who
was named as a party member by witnesses before the McCarren com-
mittee, but declined to answer .
Mr. Rosinger was on the staff of the FPA from July 1 1942 (at
which time the late Maj . Gen . Frank R . McCoy was the FPA presi-
dent), until June 30, 1948. During the time of his employment no one
at the FPA had any reason to think Mr . Rosinger might be a Com-
munist. The testimony above referred to before the McCarran com-
mittee was not given until 1952, which was 4 years after he had ceased
to be employed by the FPA.
Maxwell Stewart, also mentioned in the report, was a staff member
of the FPA from 1931 to 1934 during which time he wrote several
articles for the Foreign Policy Association reports. So far as we
know, he has never been cited as a Communist .
(5) That other individuals connected with the association, although
not actually subversive, have lacked objectivity and hold views
which are questionable
Various individuals are selected from among the board, staff, and
authors of the Foreign Policy Association for special mention . In-
cluded among those names are Roscoe Pound, one of the most dis-
tinguished American students of the law, dean for many years of
the Harvard Law School, author of many books in the field of juris-
prudence, recipient of many awards and distinctions for distin-
guished academic and public service . Another is Anna Lord Strauss
who has had a notable career as businesswoman, editor, member of
local, national, and international boards and committees, active in
public service in many private organizations and governmental
agencies.
Vera Micheles Dean, member of the FPA staff since 1928, is sin-
gled out for special comment of an unfavorable nature . For instance,
on page 28 of the report it is stated that she "is referred to fre-
quently in the MacCarran committee report on the Institute of Pacific
Relations." Again, on page 64 a brief newspaper report of a single
speech is used to describe her point of view as socialistic . In the
same section a quotation is lifted from a book review in the New
York Herald Tribune which read out of context might tend to sup-
port the newspaper story . It is interesting to note that the review
begins :
At a time when virtually every book about Europe presents, usually with
passionate urgency, some solution for the complex problems of that continent,
it is refreshing to read Mrs. Dean's calm and measured discussion of Europe's
place in today's world .
In the . quotation from the report cited on page 7 of this statement it is
alleged that "many (of the Headline Series booklets) were written by
persons cited to be of Communist affiliation and are questionable in
content." The first half of this allegation has been dealt with . With
respect to the second half we submit that this charge evidences a point
of view underlying the entire report, which is violative of the most
fundamental principles of our government .
What does "questionable in content" mean? It apparently means
that the book in question contained views which the author of the
report disapproved :of. It is obvious from a reading of the quota-
tions from the books of Mr. Lerner and Dr. 0. Frederick Nolde, whose
writing is referred to in the report as "one further illustration of the
internationalist trend of the Foreign Policy Association," that there
is nothing in either of them which could possibly be considered as
subversive. All that "questionable in content" therefore means is
that the author of the report does not agree with it .
Whether views in a book meet with the approval or disapproval of
the author of the report or any Member of Congress should, be, we
submit, wholly irrelevant to the questions before the special commit-
tee. To adopt any other point of view would be tantamount to adopt-
ing the Soviet position, which is that no book may be published which
expresses views not approved of by the Kremlin .
CONCLUSION
While there are a few other incidental references to the Foreign
Policy Association in the report, we believe that we have dealt with
the important allegations .
We submit that the evidence presented in no way justifies the
charges which the report makes against the Foreign Policy Associa-
tion.
FOREIGN POLICY ASSOCIATION.
By , President.
APPENDIX A
BOARD OF DIRECTORs-1954
Mrs . George S . Auerbach, G . Fox & Co., Hartford, Conn. ; residence, 1040 Prospect
Avenue, Hartford, Conn.
William H . Baldwin, 205 East 42d Street, New York 17, N . Y . ; residence, New.
Canaan, Conn .
Melvin Brorby, 135 S . LaSalle Street, Chicago 3, Ill . ; residence, 1320 N. State
Parkway, apartment 6B, Chicago 10, Ill .
Mrs . Andrew Galbraith Carey, R. D . 2, Westport, Conn .
John F . Chapman, 5 Walnut Street, Cambridge, Mass . ; residence, 26 East 93d
Street, New York 28, N . Y.
Edwin F . Chinlund, 45 Gramercy Park, New York 10, N . Y.
Edgar M . Church, in care of Lewis & MacDonald, 15 Broad Street, New York 5,
N . Y. ; residence, 164 East 72d Street, New York 21, N . Y.
Ernest T . Clough, 411 East Mason Street, Milwaukee, Wis .
Brooks Emeny, 221 Elm Road, Princeton, N . J.
Mrs. John French, the New York Times, 229 West 43d Street, New York 36,
N . Y . ; residence, 144 East 38th Street, New York 16, N . Y .
Clayton Fritchey, National Democratic Committee, 1200 18th Street NW .,
Washington 6, D. C .
Gordon Gray, University of North Carolina, Chapel Hill ; residence, 402 East
Franklin Street, Chapel Hill, N . C .
Mrs. Albert M . Greenfield, 6399 Drexel Road, Philadelphia 31, Pa .
William W . Lancaster, 20 Exchange Place, New York 5, N . Y. ; residence, Grand
View Circle, Manhasset, N. Y.
Mrs. Henry Goddard Leach, 1021 Park Avenue, New York 28, N . Y . ; summer, in
care of Ausable Club, St . Huberts P. 0 ., Essex County, N. Y .
Edward S . Morris, 123 South Broad Street, Philadelphia 9, Pa. ; residence, 1921
Panama Street, Philadelphia, Pa .
John W . Nason, FPA ; residence Tudor Hotel, 304 East 42d Street, New York 17,
N. Y. ; 530 Walnut Street, Swarthmore, Pa .
J . Warren Nystrom, foreign policy department, United States Chamber of Com-
merce, Washington, D. C.
George W. Perkins, 342 Madison Avenue, New York 17, N . Y . ; residence, 6 East
94th Street, New York 28, N . Y.
H . Harvey Pike, 120 Wall Street, New York 5, N . Y. ; residence 54 East 92d Street,
New York 28, N . Y .
George Roberts, 40 Wall Street, New York 5, N . Y. ; residence, 139 East 79th
Street, New York 21, N . Y .
John D . Rockefeller 3d, 30 Rockefeller Plaza, New York 20, N . Y . ; residence,
1 Beekman Place, New York 22, N . Y .
Charles E. Saltzman, Henry Sears & Co ., 385 Madison Ave ., New York 17, N. Y . ;
residence, 1112 Park Avenue, New York 28, N . Y.
Eustace Seligman, 48 Wall Street, New York 5 . N . Y . ; residence, 126 East 74th
Street, New York 21, N. Y .
Miss Anna Lord Strauss, 27 East 69th Street, New York 21, N . Y. ; Stepney, Conn .
Arthur E . Whittemore, 220 Devonshire Street, Boston 10, Mass .
Robert W . Williams, Price, Waterhouse & Co ., 123 South Broad Street, Phila-
delphia 9, Pa .
Shepherd L. Witman, Council on World Affairs, 922 Society for Savings Building,
Cleveland 14, Ohio .
James D . Zellerbach, 343 Sansome Street, San Francisco, Calif . ; residence, 2790
Broadway, San Francisco, Calif .
HONORARY
Paul Kellogg, 265 Henry Street, New York 2, N . Y . ; summer, Cornwall-on-Hudson,
N . Y.
Herbert L . May, the Berkshire, 21 East 52d Street, New York 22, N. Y. (apart-
ment 1610) .
The Honorable James G . McDonald, 350 Fifth Avenue, room 5910, New York 1,
N . Y . ; residence, 9 Alden Place, Bronxville, N. Y .
Miss Esther G. Ogden,139 East 66th Street, New York 21, N . Y.
The Honorable H. Alexander Smith, Senate Office Building, Washington, D . C . ;
residence, 81 Alexander Street, Princeton, N . J .
Mrs. Learned Hand, 142 East 65th Street, New York 21, N . Y . ; summer, Low-
court, Windsor, Vt.
I have prepared the foregoing statement and I swear that the facts
stated upon personal knowledge are true and that the facts stated
upon other than personal knowledge are true and correct to the best
of my knowledge and belief .
FOREIGN POLICY ASSOCIATION,
By JOHN W . NOON, President .
Subscribed and sworn to before me the 24th day of August 1954 .
CARLOYN E . MARTIN,
Notary Public, State of New York .
Commission expires March 30, 1955 .
EXCHANGE OF CORRESPONDENCE WITH MR . SPRUILLE BRADEN

APRIL 5, 1954 .
Hon. SPRUILLE BRADEN,
New York, N . Y.
DEAR Mx. BRADEN : Mr . Ettinger has told me of your willingness to help us
in our study and investigation of tax-exempt foundations and comparable organ-
izations. A copy of House Resolution 217, 83d Congress, creating this committee,
is attached for your information .
Your testimony before the Senate Internal Security Subcommittee suggests that
your observations of trends in the conduct of foreign affairs coincides wtih one
of our research hypotheses-namely, that our foreign policy is influenced by
persons and groups operating under a veil of anonymity, but nevertheless effec-
tively promoting ideas detrimental to the welfare of this Republic .
Specifically, we would like to know
1 . What is the influence of tax-exempt foundations on our foreign policy?
(e. g ., Carnegie Endowment, Rockefeller Foundation, Ford Foundation, Rhodes
Scholarship Trust, etc . )
2 . How do foundations operate in the field of foreign relations? (Support
of pressure groups, interlocking directorates, development of literature, spon-
sorship of experts, frequent appointments of foundation officers by Govern :
went, etc . )
3 . Is the influence of tax-exempt bodies, that are free from public control and
responsibility on our foreign policy directly or via control of public opinion and
propaganda media desirable?
We will appreciate your comments on these problems . I would, of course, be
obliged if you would telephone me at your convenience at my New York office
(Murray Hill 2-0127) and perhaps arrange for a meeting .
Very truly yours,
General Counsel .
NEw YORK, N . Y ., April 10, 1954.
Mr . HENS A . WORMSER,
New York, N . Y .
DEAR MR. WORNSER : Please excuse my delay in answering your April 5 letter,
as I have been absent from the city.
As I told Mr . Ettinger, presently I have not enough concrete information in
my possession to be of any real assistance to you as a witness . I have the very
definite feeling that a number of the foundations have been taken over by what I
described in my testimony before the Senate Internal Security Subcommittee,
not so much by the Communists, as by State interventionists, collectivists, mis-
guided idealists, "do-gooders" and "whatnots," and that this is one of the great-
est perils confronting our country today .
Similarly, my respect for the Rockefeller Foundation in connection with its
health work in such places as Colombia, in yellow fever, malaria, etc ., has been
severely jolted when I read that Chester Bowles has now been made a director
of that institution . The reason for my concern is that only a few months ago,
I heard the former Ambassador and Governor of Connecticut declaim against
the Farewell Address and George Washington- as typifying the evils of isola-
tionism [sic] .
Perhaps, given time, I could check up on some matters which would make my
testimony more authoritative than it could possibly be now . But, in answer to
your specific questions, all I could say is that I have the very definite feeling
that these various foundations you mention very definitely do exercise both
overt and covert influences on our foreign relations and that their influences are
counter to the fundamental principles on which this Nation was founded and
which have made it great.
While I feel that something should be done about this situation, I would
regret to have even more Government controls . though I recognize that at times
it is necessary to fight fire with fire . But I have not thought through to a con-
clusion in the premises .
With all best wishes,
Faithfully and cordially yours,
CPt:L.'iLLE BRADEN .
49720--54-pt . 2---16
EXCHANGE OF CORRESPONDENCE BETWEEN GENERAL COUNSEL AND
SELECTED UNIVERSITY PROFESSORS
Shortly after the committee began its hearings in May 1954 the
general counsel wrote the following letter to professors at leading uni-
versities soliciting their comments on the operation of foundations in
the social sciences :
MAY 13, 1954.
DEAR PROFESSOR : In connection with the current hearings of the House
of Representatives committee investigating foundations, we shall consider,
among other things, the criticism that the foundations and associated organiza-
tions having to do with social-science research have promoted an excess of
empiricism. It has been suggested that you might be good enough to give us
your reflections in that area.
Would you be good enough, therefore, at your early convenience, to give us
any comments which you might be willing to offer, particularly on these points
1 . Whether there has been an unfair or undesirable preponderance of empirical
research .
2 . Whether this has had any unfortunate results and if so what .
3 . Whether the apparent emphasis on training researchers in the empirical
approach almost to the exclusion of the theoretical approach is desirable for our
society.
We would appreciate any further comments of any kind which you might wish
to make regarding the operation of the foundations and/or the associated research
organizations in the social sciences .
We would, of course, expect to be permitted to use your comments in our
record.
I would deeply appreciate an early reply .
Sincerely yours,
RENE A . WORMSER, General Counsel .
The professors to whom it was sent were
Prof . Theodore Abel, sociology department, Columbia University, New York, N . Y.
Prof. C . Arnold Anderson, department of sociology, University of Kentucky,
Lexington, Ky.
Prof . Herbert Blumer, chairman, department of sociology and social institu-
tions, University of California, Berkeley 4, Calif .
Prof . James H. S . Bossard, University of Pennsylvania, Philadelphia 4, Pa .
Prof . R . E. DuWars, chairman, sociology department, Bucknell University, Lewis-
burg, Pa .
Prof. Charles S . Hyneman, professor of political science, Harris Hall 105, North-
western University, Evanston, Ill .
Prof. Oliver Martin, University of Rhode Island, Kingston, R . I.
Prof. William M. McGovern, Northwestern University, Evanston, Ill .
Dr . Helmut Schoeck, visting research fellow in sociology, Yale University, 206
Highland Avenue, West Haven, Conn .
Prof. Pitirim A . Sorokin, Harvard University, Emerson Hall, Cambridge 38,
Mass.
Prof. Ludwig von Mises, 777 West End Avenue, New York 25, N. Y .
Dr . K . A . Wittfogel, Chinese history project, Low Memorial Library, Columbia
University, 420 Riverside Drive, New York, N. Y.
Prof . Carle C. Zimmerman, department of social relations, Harvard University,
Cambridge 38, Mass.
1184
No reply was received from Professor Abel, Professor DuWars,
Professor McGovern, or Professor Martin. Correspondence with the
others arranged alphabetically follows
UNIVERSITY OF KENTUCKY,
COLLEGE OF ARTS AND SCIENCES,
DEPARTMENT OF SOCIOLOGY,
Lexington, May 26, 1954 .
Mr . RENE A . WoRMSER, General Counsel,
DEAR MR . WoRMsER : Your inquiry about the work of tax-exempt foundations
is most difficult to answer . It will be necessary for me to write at some length
in order to avoid giving you an ambiguous statement . The delay in sending you
this statement has been occasioned by my taking the time to read with some care
the report of the 1952 hearings on this same subject.
The following comments should be regarded as my professional judgments, not
merely opinions. I am, however, expressing my own judgments and not those
of my university, department, or any group of scholars to which I may belong .
In order that you may interpret my remarks, I should state that I am not con-
nected in any way with a foundation . At one time I received a stipend from a
foundation for a year of graduate study. Some years ago, also, I was an editor
for a publication by a foundation . On the other hand, two applications within
recent years for research grants were rejected by foundations . My knowledge
of foundation-supported research is nonetheless rather extensive in that I at-
tempt to read very widely in both my own and related scientific disciplines . I
am also on the advisory editorial board of a professional journal ; in that con-
nection I read a considerable number of manuscripts, including some that do not
receive publication.
It is not within the scope of questions raised by your letter for me to consider
the problem of registration or other methods of insuring that foundations con-
form to the stipulations implied in their tax-exempt status . A clear distinction
between foundations engaged in partisan propaganda or mere tax-evasion and
those engaged in research is obviously necessary . So far as my limited acquain-
tance or that of my colleagues extends, the foundations devoted to the sponsoring
of research and learned studies have an excellent record .
It would seem to be clearly imperative that no effort should be made to
influence by governmental means the manner in which foundations carry out
their support of scholarly work . It would seem prudent to leave the balance
between various kinds of research to be decided by the foundations and the
learned disciplines. Too many efforts are being made today to control science
because one or another group does not find the results of research palatable .
In judging the work of scientists it is too often forgotten that any research
in either the physical or the social sciences has practical implications . Such
research will inevitably affect adversely the prestige or the prosperity of some
groups, agencies, or interests in the Nation . Thus, for example, to demonstrate
that one metal is superior to another for some engineering use favors the manu-
facturers of that metal and injures the interests of the makers of competing
metals . In a world of change where we can exist and prosper only with the
aid of research, such effects are inevitable, and indeed desirable. To have judged
research by whether its results were congenial to the buggy industry would
have stifled the automobile industry .
I should like to comment particularly on the relationship of what you have
called the "empirical approach" to the "theoretical approach ." Insofar as we
are hopeful that the American way of life may be safeguarded by scholarly re-
search and study, we must recognize that it is impossible to have too many
empirical facts. The reason for this situation is simply stated . It is easy
to draw up the blueprint for an ideal society ; there have been thousands of such
utopias in human history . But to improve actual societies has proven more
difficult . That our society has manifested a high degree of freedom and prog-
ress is demonstrated by facts . It is empirical fact also that demonstrates the
wide gap between utopian blueprints of communism and communism in practice .
Facts are the most convincing answer to any who may be swayed by communistic
propaganda .
A democratic society cannot be preserved without freedom of inquiry . Free-
dom of inquiry is the only road to truth . For any body of men to use power or
the regulative agencies to constrict the field of scientific study would be to
imitate the worst features of Soviet society . The future welfare of American
society cannot be assured without freedom of research into facts-facts about

our social organization as well as about our natural resources . Whoever would
limit the search for facts in our civilization stands self-convicted of special
pleading . The answer to inadequate facts is more facts .
Critics of the social sciences forget that social scientists are responsible
scholars . The ethical code of science is a strict disciplinarian . We social
scientists spend a large part of our time-and the professional journals devote
a large portion of their space-to debating the merits of one type of facts or
method for obtaining the facts against the merits of other methods . We con-
stantly weigh the importance of particular facts against the analytical concepts
or theories by which we organize those facts into generalizations that will accu-
rately portray the structure of society . Theories and facts are Siamese twins .
The best searchers for facts are usually also the best organizers of facts into
sound theories and vice versa . Fact and theory are constantly at play, one
upon the other. Every reputable social scientist strives constantly to balance
and integrate those two facets of scientific work .
An enticing theory can be developed while stretched out in an easy chair ;
all that is needed is pencil and paper . But of the thousands of theories, how-
ever conscientiously conceived, only a handful will prove valid when subjected to
the crucible of facts . Unfortuntely, to obtain facts requires money . Knowl-
edge is the most expensive commodity in the world. Few professors have private
wealth to underwrite their research . Few colleges or universities have money
to support more than a meager research program . The uniquely sustaining
service of foundations in America has been to provide the money for this indis-
pensable purpose .
If one reads the prefaces of current books or the footnotes of technical articles,
whether they be reports of empirical research or works devoted primarily to
theory, he must be impressed with the large proportion of contemporary scholarly
work that has received subsidy from some foundation . Unless we are to turn
almost exclusively to the Government for such aid-and this would entail results :
more deplorable than any charge that can be brought against the foundations-
scholarship will wither without foundation assistance .
At one time I was an editor for a publication by the Social Science Research
Council . In that publication an effort was made to integrate theory and re-
search . At no time during the work was any influence brought to bear by the
sponsoring foundation . I read most of the publications by this council . To
ale they balance very sagely the needs for fact gathering and the need for
integrating theory . Most of the major foundations, at least, so far as I can
observe or hear, are similarly scrupulous and farsighted.
More than anything else, the foundations desire the good opinion of the world
of scholars. Scholars are the first to censure loaded or biased work . They are-
the first to condemn poor work . They are constantly scrutinizing the operations
of the foundations . There is no surer path to professional fame than to have
one's name associated with an acceptable theory and no easier path than to
demonstrate that some grand project has been bumbled .
By its very nature, science is a self-correcting activity . No other human
agency-except a free enterprise econonmy-bas a mechanism for correcting error
built into its very structure .
Every study, whether or not subsidized by a foundation, has defects . But
we have to apply the test of prudential judgment to the work of foundations as
we do to that of any other group in Government or private life . And by that
test, in my judgment, it can be shown that only a small portion of foundation-
supported research studies have been biased or poorly conducted .
To answer your specific questions categorically, on the understanding that these
categoric comments will not be used without the foregoing discussion, I would
make these statements
1 . There has not been an unfair or undesirable preponderance of empirical
research . What the social sciences need is enormously more money for the
collection of facts, and for the testing of theories by facts.
2 . The only unfortunate result has been the all too slow accumulation of facts .
The more rapidly we can accumulate reliable facts, the more rapid will be the
codification of sound theory and reliable principles of human behavior-for the
use of our political representatives or other responsible individuals and organi-
zations .
3 . There has not been, in my judgment, a disproportionate emphasis in train-
ing researchers in the empirical approach . To refer to my own year of train-
ing by courtesy of a foundation, I was enabled to attend one of our best uni- -


versities specifically to obtain a better grounding in theory . Innumerable other
individuals have been similarly assisted . The experience of a close friend with
a current committee supported by a foundation leads me to conclude that once
more a strong emphasis is laid upon adequate theory to guide the collection
of facts with which to develop better theory . Theories by themselves cost little
but sound theory must rest on valid facts, which are enormously expensive .
If I may judge by news items in the New York Times during recent days, the
purposes being expressed through your inquiry are not only multiple but per-
haps contradictory . It seems to me to be imperative that research work be
judged by those who are trained in scientific methods . It is to be hoped that
the conclusions of the committee may be praised in later years principally for
having encouraged the launching of new foundations devoted to the advance-
ment of human knowledge .
It has been a pleasure and a privilege to have the opportunity of contributing
my judgments on this important question . I should be happy to extend my
remarks in a further communication, or in person, at your pleasure .
Sincerely yours,
C . ARNOLD ANDERSON .
JUNE 7, 1954 .
Prof . C . ARNOLD ANDERSON,
Department of Sociology, University of Kentucky, Lexington, Ky .
DEAR PROFESSOR ANDERSON : Many thanks for your letter of May 25, which
I have read with great interest . I wish I had time to answer it in considerable
detail, but the pressure of work prevents .
I would like to suggest, however, that the accounts in the newspapers cannot
give you any fair understanding of the objectives of our inquiry, or of the
limitations which the committee has put upon itself . It stands unanimously
behind the theory of free inquiry, whereas the newspapers have rather broadly
given the impression that ours is an attempt at censorship .
There is, of course, one factor of possible "censorship" involved. The tax law
itself proscribes certain areas of activity (principally subversion and political
propaganda) . After all, these are tax-free funds with which we are concerned
and, thus, public trusts. The public is entrusted to be protected against having
tax-free money used for things against the public interest. Outside of this
element of what might be called (but unfairly) "censorship," foundations are
free to do as they choose .
Far from being against free inquiry, we are concerned with the validity of
frequent criticism that the major foundations which operate in some close asso-
ciation through intermediate organizations, etc ., have virtually exercised a form
of censorship themselves . This consists of supporting primarily certain ap-
proaches in research in the social sciences to the virtual exclusion of the
opposites . As research in the social sciences in the United States is now almost
entirely foundation supported (except for that financed by the Government it-
self-and this, in turn, seems under the control or direction of organizations
and individuals financed by the foundations) it seems to us necessary to
inquire whether this criticism is justified . There should obviously be free com-
petition in matters of the intellect as well as in business .
Nor is there any validity to any newspaper suggestions that this inquiry is
directed against foundations as such . The committee is unanimous in its ap-
preciation of the desirability of foundations . Its interest is in discovering what
abuses may exist, to the end of doing what it can to make these organizations
even more socially desirable than they now are . It may well be that the dis-
closure of criticisms and the airing of abuses may help the foundations to in-
crease their acceptability and utility .
May I thank you again for taking the trouble to answer my letter in detail .
Sincerely,
RENE A. WORMSER, General Counsel.
WHARTON SCHOOL OF FINANCE AND COMMERCE,
UNIVERSITY OF PENNSYLVANIA,
Philadelphia 4, June 1, 1954.
Hon. RENE A . WoEMSER, General Counsel.
DEAR MR. WORMSER : To answer your letter of May 13, I must first attempt to
qualify, and then to disqualify, myself as a witness .
First, as to qualifications . I have been a professor of sociology now for 44
years . This includes services at the University of Pennsylvania, the University
of California at Berkeley, and Yale University . In the course of this period,

I have written, wholly or in part, and edited, wholly or in part, more than 30
volumes and contributed about 75 articles to scientific journals . Research activi-
ties include the direction of two nationwide surveys and the development of-sev-
eral volumes of research papers . Since 1938, I have devoted myself largely to the
development of research studies in the field of child behavior .
As to disqualifying myself, I am indicating the reasonable suspicion that I
may be prejudiced, in that I have never been able to obtain a single grant from
any research foundation or organization . On the other hand, I have a number
of times asked for, and I have always been granted promptly, research moneys
from the faculty committee of my university . I have also obtained, without a
single refusal, money for research purposes from people of means who are
familiar with my work .
As a lifelong student of social problems and policies, I am impressed with the
great difficulties and grave responsibilities of administering large amounts of
money for research or any other social purpose . Naturally, this makes me hesi-
tant to criticize those persons who are charged with these responsibilities . I am
willing, however, to express a viewpoint, in the hope that it may in some slight
way contribute to the formation of sound judgments .
For some years, I have regarded with increasing apprehension the develop-
ment of what I have called the comptometer school of research in social science .
By this I mean the gathering of detailed social data and their manipulation by
all the available statistical techniques . Not that I am objecting to such
methods-my reluctance rather lies in an unwillingness to accept these as the
core of research in human behavior.
My own interest lies more in the development of qualitative insights . This
accords with my judgment of the nature of the life process, that it cannot be
reduced to statistical formulas but that it is a richly diversified complex of re-
lationships. The chief purpose of research for university people, most of whom
are limited to working with small groups, should be weighted heavily in the direc-
tion of research in qualitative insights rather than manipulation of mass data .
I am particularly concerned with the impression which the recent emphasis
upon the comptometer approach has created among younger sociologists as to
what constitutes social research . The moneys and the influences of the large
foundations naturally do a great deal to set the norms of professional acceptance
in a given field, and it is in this respect, difficult to measure statistically but
possibly of very great importance, that a distinct disservice may be done to
sociological research by an undue emphasis upon any particular emphasis or
methodology .
Cordially yours,
JAMES H. S . BOSSARD,
Professor of Sociology .
UNIVERSITY OF CALIFORNIA,
DEPARTMENT OF SOCIOLOGY AND SOCIAL INSTITUTIONS,
Berkeley 4, Calif ., May 21, 1951 .
Mr. RENE A. WORMSER, General Counsel .
DEAR MR. . WORMSER : I am relying to your gracious inquiry of May 13 soliciting
an expression of my judgment on the character of social science research fostered
by foundations and associated organizations .
I have been critical and am critical of much of this research . However, ques-
tions of what is appropriate in social science research-are not in the competency
of congressional committees, but should be determined, properly, by the scientific
professions in whose fields such issues fall . Good avenues of communications
exist between the social science societies and the foundations interested in
social science research . Such channels are the proper medium for the considera-
tion of criticisms and the correction of whatever foundation policies are judged
to be faulty by members of the professions . Since I am wholly unsympathetic to
placing the determination of these matters in the hands of legislative groups, I
am refraining from answering your points.
I trust that this letter will be entered on the records of your committee .
Respectfully yours,
HERBERT BLUMER, Chairman.


NORTHWESTERN UNIVERSITY,
THE COLLEGE OF LIBERAL ARTS,
Evanston, Ill ., July 22, 1954 .
Mr. RENT A . WORM SEE, General Counsel.
DEAR MR . WORMSER : I did not sooner reply to your letter of June 24 because I
wanted to think over the questions you put to me. I will take them up in the
order of their appearance in your letter .
1. I have always supposed that there is indeed a "close interlock or a concen-
tration of power" between the foundations on the one hand and the so-called
learned societies, such as the Social Science Research Council and the American
Council of Learned Societies, on the other hand . I have long understood that
few, if any, of the learned societies have an endowment of notable size or receive
current income from memberships . It is my understanding that these learned
societies have depended mainly upon the foundations for the principal part Of
their financial support . If they did not get money out of the foundations, I
don't know how they would ever be able to do anything of genuine significance .
Where a learned society is dependent on foundations for money, I think it is
inevitable that the men who direct the learned society will try to maintain
close and friendly personal relations with the men in the foundations who decide
whether they will hand over any money and how much . I have never heard
from any source that the foundation people try to dictate or influence the ap-
pointment of men to positions of any character in any of the learned societies .
When an important position in a learned society is to be filled, it is probable
that the people who must make the choice will try to , find out whether people in
the foundations have respect for and confidence in the man they propose to
appoint . I have been told, that both the Carnegie Corp . and the Rockefeller
Foundation have pretty consistently, if not in all cases, refused to make any
expression on this point . But you can read men's minds ; you don't always have
to be told who the foundation officials have confidence in and who they don't
have confidence in . I think it is a safe guess that the selection of men for high
positions in learned societies i& influenced by such a reading of the minds of
people who are high up in the foundations . I have more than once been told
by people who manage colleges and universities that "we want to find" a man
for president, or dean, or department head, "who can get money out of founda-
tions ." I suppose that people who choose men for positions in learned societies
are just as conscious of the need for winning or maintaining good will in the
foundations.
2a . This question asks whether the relationship between foundations and
learned societies has resulted in promotion of empirical research, and if so,
whether that promotion has been excessive. Certainly the foundations have
underwritten empirical research . I don't know to what extent their support of
empirical research is due to a close relation between the men who manage the
foundations and the men who manage the learned societies . One can form a
judgment as to whether the promotion of empirical research is excessive only
by considering other purposes for which the money is needed and might have
been used. Empirical research is inquiry into factual evidence . This costs
money. For several years I have been trying to make a comparative study of
American State legislatures to see what we can learn in the experience of one
State which will help people in other States decide whether they want to do
something and what they can do to improve the legislative process at home .
This means, among other things, that you have to travel about the country to
talk to a lot of people who have had experience in State legislatures and who
have thoughtfully observed the lawmaking process . I can tell you that it
costs a lot of money to do this kind of job . The alternative to underwriting
empirical study, if a foundation wants to support scholarly research, is to
underwrite men who sit in the library and read books and think . These people
don't need much money. So I would say that a fair balancing of empirical study
in comparison with historical and speculative study requires that much more
than half the money be put into empirical study . I can add to this my personal
belief that what we need more than anything else in the social sciences right
now is a whole lot more effort to get at the facts . Personally I don't think that
either the learned societies or the foundations have been giving excessive sup-
port to empirical research .
2b. Your question inquires whether there is a general political slanting of
research toward the left and whether such a slanting, if it exists, is due to a
tie-up among the foundations and the learned societies . I suppose I am a mid-
dle-of-the-roader in politics ; I voted for Dewey in 1948, for Dirksen in 1950, and
for Stevenson in 1952 . I think that the college professors who teach in social-
science departments in this country are overwhelmingly left of my position .
Furthermore, I think that many of them show a near disgraceful tendency to
overstate the liberal cause and deride the position of people who hold more con-
servative or right-wing views . I think many of these people show entirely too
little respect for what I consider to be the obligations of a man who claims that
he is an objective student and a scientist . But I must say that I have no evi-
dence whatever to support a view that either the foundations or the learned
societies have supported or wish to support this lack of objectivity and favoring
of the left-wing position . If a foundation or learned society wants to be neutral
in the matter of politics, the safest thing for it to do, in underwriting the social
sciences, is to give its money for empirical research . As I said above, empirical
study is search for factual evidence . In picking the thing he is going to study,
the empirical researcher can choose a problem in terms of his own political be-
liefs. But when he is looking for and examining factual data, he is of necessity
restrained from shooting the works in favor of his political views .
2c . The question asks whether there is a tendency toward monopoly and con-
formity, and, if so, whether this is due to a tieup between foundations and
learned societies . I don't see any tendency which I think leads to monopoly,
but I do think there is a piling up of foundation money for support of research
in universities on the east coast . I think this is due to twa things : First, the
eastern universities are close to the headquarters of the older foundations and
the headquarters of the learned societies . They find it easy to talk their prob-
lems over with these people . They are in a better position to make a case for
what they want to do than are the rest of us who live in the South, Middle West,
and far West. The second factor in favor of the East is that generally those peo-
ple have smaller teaching loads, have more time fo plan research and get it
started, and eastern universities on the whole have more men who have actually
gotten forward with research . Now the foundations and learned societies could
follow a policy of trying to find and underwrite the really good men who have not
had a good chance to do research . I personally, think they ought to do more of
this. But on the other hand, they can with good reason argue that they ought to
invest their money in men who have already shown what they can and will do . I
suppose they avoid criticism by doing the latter . If they put their money in men
who are already going ahead with research the foundations and learned socie-
ties can say that they are not trying to remake the country or cause it to go in
different directions from the way it is already going . If they go about hunting
up men and underwriting men who have not yet done much research, they will
be accused of trying to determine the direction in which research will go and of
trying to remake the mind of the Nation to suit the people who manage the foun-
dations and learned societies .
3 . I have no evidence to cause me to think that the foundations have any wish
or intention to slant research or slant the mind of the Nation toward collectivism .
But I do think that an overwhelming part of the social science professors in this
county lean toward collectivism . Insofar as the foundations underwrite social
science professors they probably help along more men who favor collectivism
than men who oppose collectivism . Furthermore, many social science college
.professors present their personal beliefs when they ought to be trying to do
objective inquiry. Now it may be that the foundations ought to give every man
a test before they give him any money, the purpose of the test being to find out
whether he is really an objective scholar and not a preacher . I will not offer
an opinion as to what they ought to do on this point .
I have tried to address myself to the specific questions you put . Now I will tell
you about my experience with one learned society, the Social Science Research
Council . For 3 years I was a member of its committee which awarded grants-in-
aid for research . The top amount we were permitted to grant any man was $1,000
for a period of 1 year. When we had more applications than we had money to
satisfy we always favored the little fellow and the man who seemed to be over-
looked . If a man had a salary of $9,000 it was a rare case indeed when we gave
him any money. We gave our money to the youngsters who were having trouble
making a living and to men who had heavy teaching loans in colleges and uni-
versities with limited resources . The questions we asked about all applicants
were these : (a) Is he an intelligent man ; (b) can he actually do the job he is
trying to do ; (c) can we be sure he will carry this project to completion ; (d) is
the thing he proposes to do worth doing? We gave money for both empirical re-
search and historical and speculative study . I never knew any member of the
committee to raise the question as to whether this man is conservative or lib-


eral or to raise the question whether this project will tend to support a con-
servative or a liberal point of view . I can say with absolute confidence that if
any member of the committee had ever raised either question he would have
been smacked down promptly by other members of the committee .
Now I suppose you need to know what kind of a man I am so that you can
judge whether I may be speaking honestly or trying to pull the wool over your
eyes. I have already told you how I voted in the last three elections . I may add
that I have insisted in conversation with my friends on this faculty that there
are two sides to the McCarthy question . I have furthermore spoken in favor of
McCarthy in these conversations in order to counter what I consider to be
extremism and unwillingness to look at evidence on the part of the anti-McCarthy-
ites I talk to . The consequence of this is that I hear I am a pro-McCarthy man
who wants to destroy freedom of speech for the Nation and render the university
incapable of functioning as a place for freemen to make objective inquiry .
Finally, the total amount of money I have personally received from all founda-
tions and learned societies for my own research is $750 .
Sincerely yours,
CHARLES S . HYNEMAN,
Professor of Political Science, Northwestern University.
YALE UNIVERSITY,
DEPARTMENT OF SOCIOLOGY,
New Haven, Conn ., May 17, 1954 .
Mr. RENE A . WORMSER, General Counsel .
DEAR MR. WORMSER : Your letter of May 13 was missent and reached me with
considerable delay . I shall be very glad to send you my comments on the points
mentioned in your letter . However, in view of the fact that you might use my
comments in your record I should like to have a few days for drafting the reply .
I appreciate your interest in whatever I may be able to contribute .
Sincerely yours,
HELMUT SCHOECK, Ph . D .,
Visiting Research Fellow in Sociology.
HARVARD UNIVERSITY,
RESEARCH CENTER IN CREATIVE ALTRUISM,
Cambridge 38, Mass ., May 18, 1954 .
Mr. RENA A . WORM SEE, General Counsel.
DEAR MR. WoRMSER : My brief answers to your three questions are as follows
In regard to the first question, I can state that so far as social sciences are
concerned, most of the foundations certainly favor to an excessive degree empiri-
cal research and greatly discriminate against theoretical, historical, and other
forms of nonempirical research . This one-sidedness by itself would not be ob-
jectionable if (a) empirical research were not still more narrowed and reduced
to either statistical research or research along the line of the so-called mathe-
matical and mechanical models, or other imitative varieties of so-called natural
science sociology ; (b) if the topics investigated were of some theoretical or prac-
tical importance ; and (c) if most of the favored researchers were competent
social scientists. Unfortunately, in cases of overwhelming bulk of granted
financial help, these three conditions were absent .
As to your second question, the results of the above kind of research (which
has been prevalent for, roughly, during the last 30 years in American social
sciences), with very rare exception, have been of 2 kinds : (1) the bulk of this
sort of research has been perfectly fruitless and almost sterile from a theoretical
or practical standpoint ; (2) some of the investigations, made especially along
Freudian and similar theories (or popularizing these sort of views), have been
rather destructive morally and mentally for this Nation .
Third, my answer to the second question partly answers your third question,
namely, that such an exceptional emphasis on training researchers along the
above-mentioned lines, with almost complete exclusion of the theoretical ap-
proach, is certainly undesirable for our society, either from a purely scientific
or from a practical standpoint.
These, in brief, are my answers to your questions . In giving these answers I
want you to keep in mind that I am not giving them offhand and on the spur of
the moment . For some 32 years I have been in the midst of American social
science, particularly sociology, and correspondingly have been closely following

all the main currents in American social thought . In addition, at the present
time I am completing a special volume, the title of which is somewhat self-
explanatory, namely, Fads and Delusions in Modern Sociology, Psychology, Psy-
chiatry, and Cultural Anthropology . In this volume which I hope to complete by
the end of June or July of this year, I am critically examining exactly all the
main currents of impirical research in the social sciences particularly favored
by the foundations-sometimes by colleges and regularly by the United States
Navy, Army, and Air Corps-spending a considerable amount of funds for this
sort of research.
The final conclusions which I have reached in this volume are identical with
the answers which I have given to your questions . I hope that the volume gives
the necessary minimum of evidence to corroborate that my conclusions are
correct. The futility of excessively favoring this sort of research particularly is
well demonstrated by its sterility, in spite of the many millions of dollars, enor-
mous amount of time and energy expended by research staffs . Almost all of the
enormous mass of research along this line in the United States of America for
the last 25 or 30 years has not produced either any new significant social theory
or any new method, or any new technique, or any scientifically valid test, or even
any limited casual uniformity . This sterility is perhaps the most convincing
evidence of unwise policies of the foundations, colleges, and Army, Navy, and
Air Corps research directors .
My book is going to be published by the Henry Regnery Co. I do not know
exactly when it will be published, but probably in 1955 ; or, if it is somewhat
urgently hurried, it may be published at the end of this year . I hope, anyhow,
to deliver my manuscript to the publisher sometime the end of June or July .
I hope, also, that when it is published this volume may be of some help to your
committee .
With my best wishes .
Sincerely yours,
PITIRIM A. SOROBIN .
NFw YORK 25, N. Y., May 24,1954 .

Mr . RENE A . WORMSER, General Counsel.
DEAR MR. WORMSER : Referring to your letter of May 13, 1954, I should like to
submit the following remarks
I have in my books and articles critically analyzed the epistemological and
political prepossessions that are responsible for the scientific sterility of the
present-day academic treatment of the problems of human action, in this country
as well as abroad . I think that the fanatical dogmatism prevailing in many
faculties and the virtual boycott of all dissenters are among the most alarming
symptoms of the actual crisis of western civilization .
It is a fact that the intolerant practices of many university departments of the
social sciences are lavishly financed by some rich foundations . These foundations
are uncritically committed to the epistemological ideas and the political bias
prevalent in the university faculties . But it was not foundations that inaugu-
rated this tendency and converted the professors to their own tenets . It was,
on the contrary, the universities that converted the foundations to their opinions .
The trustees and the staffs of the foundations were convinced that the best
method they could choose was to put their trust in the professors . They were
deluded by the prestige that the name universities enjoyed . They adopted the
professor worship current in some European countries .
In the reports of the foundations and in the public utterances of their leading
functionaries one does not discover any propositions about methods and , tech-
niques of social studies that would not be stereotyped repetitions of the slogans
coined by the self-styled "unorthodox" professors long before American founda-
tions began to spend money for these studies .
My answer to each of the three questions you formulate in the second para-
graph of your letter is emphatically yes . For a justification of my point of view
I refer to my publications.
With kindest regards .
Sincerely yours,
LUnwIG VON MISTS .


CHINESE HISTORY PROJECT,
(Sponsored by University of Washington, Seattle,
in cooperation with Columbia University),
LOW MEMORIAL LIBRARY, COLUMBIA UNIVERSITY,
New York 27, N. Y ., June 30, 1954 .
Mr . RENE A . WORM SEE, General Counsel .
DEAR MR . WORMSER : Thank you for your letter of June 25 . I am deeply aware
of the importance of the problems which it raises.
Some weeks ago, I had a stimulating conversation about these problems with
a member of your staff, Dr . Karl E . Ettinger . In the course of this conversation
I conveyed to him whatever ideas I have on the subject . But it became evident
that his study of the matter has gone far beyond my limited insights . I, there-
fore, am afraid that I have no further contribution to make to your investigation.
Yours sincerely,
KARL A . WITTFOGEL.
HARVARD UNIVERSITY,
DEPARTMENT OF SOCIAL RELATIONS,
Cambridge 38, Mass ., May 25, 1954 .
Mr. RENE A . WORMSER, General Counsel.
DEAR MR. WoRMSER : The matter of false and specious empirical research in-
stigated and supported by our tax-exempt foundations is so grave that it is
highly proper the Congress of the United States take up the matter . However,
an analysis of it requires such detailed time that I would not even answer your
letter if it were from a body less important than the United States Congress .
QUESTION I
The tax-exempt foundations in the United States have unfairly and undesirably
emphasized empirical research to such an extent that the whole meaning of social
science research has come to be ridden with sham and dubious practices .
QUESTION II
This has had undesirable and unfortunate results as follows
A . It has made research grants large and expensive and few in number .
B . A special class of fund getters has grown up who spend all their time get-
ting funds, and have little time or capacity to do original work .
C. A special class of administrators of these funds has grown up and research
is dominated by the administrators rather than the persons who pursue ideas .
D . As a result the large institutions, or a few institutions with prestige, get
the most of the money in large grants . Smaller institutions, or professors there,
get scant encouragement in seeking out new ideas . These large grants are to
big and unity percent wasted and equally brilliant Ph. D.'s, who gradu-
ated in the same classes, get no support at all . In the meantime a careful
analysis of the origins of scientific men who make a mark (Ph . D.'s who finished
by 1940 and were outstanding by 1945) shows that they come from these smaller
institutions . Of course some argue that all the best men are at the big institu-
tions with prestige but that is not true . Finding jobs for young Ph . D .'s puts
more good over at the small institutions because there are only a very few
places each year opened at the others .
E . Since social science is concentrated in a few urban institutions and bossed
both at the foundations and at the institutions by "public opinion" men, prosaic
and important aspects of our life (where real social science needs exist) never
get studied. Illustrations among many possible, it is apparent that no institu-
tion in the United States pays great attention to the problems of our Appalachian-
Ozarkian people, although institutions located in that region do, get grants for
extraneous things, involving cultures far away (like South America) . No insti-
tution in our arid West studies the total relations : of modern man to arid or
semiarid conditions . A biologist will turn naturally to dirty pond water, be-
cause the "cultures" he is interested in are found there, but our human ponds
do not have public opinion prestige, and are not generally studied. (These
statements are not a reflection upon any of the provincial groups in America .)
F. The emphasis upon false empiricism is not only a matter of the biases of
the "bosses" or administrators, the biases of the concentrated favored institu-
tions, and the neglect of the provincial and needed problems for study, but it
also has led to a malfeasance or injury in method and has harmed the growth
of social science .
1 . Social science is about 95-percent macroscopically, or broad-scale observa-

tional . It is not inevitably less scientific for that reason, as geology and astron-
omy are not less scientific than zoology or chemistry . The extreme methods of
overluscious empiricism on a few prestige problems is as ridiculous as trying
to build a house with the use of a micrometer for each measurement .
2 . As a result we overstudy certain aspects of a few problems and never touch
the others . As a professor, well renowned for his own social science researches
(which have not been supported by the big tax exempt foundations), remarked,
"We research ceaselessly upon getting married, but never study what to do about
the problems involved in the act over the next 40 or 50 years ."
3 . We have many persons who can work out correlation coefficients but no
one so far has told us what they mean in "causal" analysis . Our social science
is increasingly dominated by meticulous clinical procedures and becoming more
and more illiterate as to logic and common observation .
4 . As a result we are creating a social science merely which is the doctrine
of a "cult," read only by a few other social scientists, abstruse to the point of
illegibility, valueless for social direction, constantly repeating itself upon imma-
terial problems, and ending in an aimless existential philosophy . As a prominent
European philosopher indicated clearly within the past decade, "modern social
science is becoming an aspect of the existential philosophy of decadence ."
(This is a paraphrased quotation from Nordberto Bobbio, Existentialism the Phi-
losophy of Decadence, New York, 1947 (English translation) .)
QUESTION III
The above analysis leads me to your question 3, which is concerning the
desirability of the exclusive training of researchers in the empirical approach .
The situation outlined in answers to questions 1 and 2 shows that the over-
emphasis upon empirical training and support lead to a division in the social
scientists between those who follow abstruse theoretical "systems" and those
who follow equally abstruse pointless research . Our abstruse theoretical sys-
tems have become increasingly only taxonomic (classifying a society into minute
details according to one scheme or the other) and useless repetition . There is
little or no integration between theory and research, because they deal with
different things . As •a result the empiricist has no theoretical foundation for
valid conclusions .
To illustrate this, without citing names, one man gathered numerous empirical
facts upon the existence and widespread use of small-scale torts within our
society and came to the conclusion that torts (he did not use this word because
he had only empirical training) should all be classified as crimes . Another
group gathered a million facts of the same nature in regard to sex ramification
and came o the conclusion that there should be no social control of sex . Both
studies were, in the opinion of many thoughtful persons, extremely socially
disadvantageous and misinforming and both received tax-exempt support in
large sums.
As a result of this I feel that the whole emphasis in training, as dominated
by our tax-exempt foundations, should be overhauled . Our research of an
empirical nature is so unrelated to theory that it becomes interpreted in extrane-
ous surface philosophies, socially harmful, and of no material meaning . (I
can prove this but it would involve me into polemics, and that I consider inad-
visable in a public document .)
One of the aspects, and results of this, is the general feeling that social science
should have no "aim" nor "utility," but should be a "study for study's sake ."
"We might discover something which will be good 50 years from now," is a
shibboleth of this school . Now cast back to 1900, and tell me what could have
been discovered by such an activity then, which could have been valuable in
the changed social conditions of today? The idea is ridiculous . Yet this feel-
ing is most prevalent in the groups who have the easiest access to tax-exempt
foundation funds . On the other hand, it is fitting with our culture that the
activities of men should aim to do some "good" or create some understanding .
directly or indirectly, I imagine these foundations are created by funds from
persons who are in the very high brackets of taxation, and the public, in a
large sense, supports almost entirely these exaggerated empirical falsities . Now
just why should the public contribute to , an activity which has no social aim?
I hope these remarks and this evaluation is of use to you . The situation is
more serious than most persons think . However, there are all that I care to
mention in a public document .
Sincerely,
CARLE C . ZIMMERMAN .
LE1i it s OF J . FRED RiPPY, PROFESSOR OF AMERICAN HISTORY, UNIVER-
SITY OF CHICAGO, TO THE LATE CONGRESSMAN E . E . Cox
(Referred to at pp . 60-62 of pt. 1 of these hearings)

During the course of the hearings, reference was made to letters
written by Prof. J . Fred Rippy, professor of American history, the
University of Chicago, Chicago 37, Ill . The correspondence referred
to follows
THE UNIVERSITY OF CHICAGO,
DEPARTMENT OF HISTORY,
Chicago, Ill ., August 4, 1.951 .
Hon . E . E . Cox,
United States House of Representatives,
Washington, D . C.
DEAR CONGRESSMAN Cox : I take the liberty of writing you this note because
I was born and educated in your part of the country . I hope a committee of
Congress will investigate the foundations in order to determine their influence
and whether the National Government should lay down some general principles
regarding the manner in which their funds are distributed . Several years ago
these funds were usually distributed by some of the major foundations to faculty
committees of various major universities and were, in turn, distributed by the
faculty committees among such members of the various university faculties as
were deemed competent and reliable . More recently this policy has been
changed, so that the funds are now likely to be distributed by a central com-
mittee at the headquarters of each foundation . This, in my opinion, means a
dangerous concentration of power in the hands of a little group of men who
either engage in favoritism or fail to secure adequate information regarding
the recipients of subsidies . Distribution of funds through widely scattered
university faculty committees would guard against these evils and assure a
wider measure of equality of opportunity based upon relative merit .
At present and for years to come, scholars in our universities will not be
able to do much research on their own because of high prices and heavy taxes .
The recipients of these tax-free subsidies from the foundations will therefore
have great advantages that will be denied the rest of the university staffs .
The favored few will get the promotions and rise to prominence . The others
will tend to sink into obscurity and have little influence in the promotion of ideas
and culture . Unless the power to distribute these immense foundation funds
is decentralized, the little controlling committees and those to whom they
award grants and other favors will practically dominate every field of higher
education in the United States . Even granting them great wisdom and
patriotism, one might still complain against this injury to the great principle
of equality of opportunity . But I have never been impressed by the superior
wisdom of the foundation heads and executive committees . The heads tend
to become arrogant ; the members of the committees are, as a rule, far from the
ablest scholars in this country .*
I make these suggestions : First, examine the methods now employed in
distributing these funds and the qualifications and attitudes of the heads and
executive committees of the foundations ; second, consider the wisdom and
prudence of decentralization in the control of these tax-free funds . If you
should conclude that it would be wise to force decentralization, consider the
possibility of either taxing these foundations, or a number of them, out of
existence or compelling them to distribute their funds annually among the best
universities and permitting faculty committees in these universities to dis-
tribute these funds among the most capable members of the faculties of the
recipient universities . In numbers there will be more wisdom and justice . I
believe our way of life is based upon the principles of local autonomy and
equality of opportunity . I strongly approve those principles and I believe you
1195
do likewise. I should not be surprised if your proposed committee of investiga-

tion should discover that concentration of power, favoritism, and inefficient use
of funds are the worst evils that may be attributed to the foundations . If they
have supported any Communists, such support has probably been unintentional .
A little group drawn from restricted areas cannot know the attitude and
allegiance of recipients hundreds of miles away who are given grants on the-
basis of letters of recommendation and perhaps a brief interview . Locally
chosen faculty members will know more about applicants from each university
than can possibly be learned through casual letters and investigations of little
groups far removed from these campuses . Those who govern this Nation and
the people who pay heavier taxes because of the exemptions granted these
affluent foundations have a right to lay down the general principles for the
distribution of their funds and favors .
Very sincerely,
J. FRED HIPPY,
Professor of American History-
THE UNIVERSITY OF CHICAGO,

DEPARTMENT OF HISTORY,
Chicago, Ill., November 8, 1952 .
Hon . E . E . Cox,
United States House of Representatives,
Washington, D . C.
DEAR CONGRESSMAN Cox : Since I wrote you on August 4, 1951, Dr . Abraham_
Flexner, a man who has had much experience with the foundations, has pub-
lished a book, entitled "Funds and Foundations," in which he expresses views
similar to those contained in my letter . I call your attention to the following
pages of Flexner's volume : 84, 92, 94, 124, and 125 . Here Dr. Flexner denies
that the foundation staffs had the capacity to pass wisely on the numerous
projects and individuals for which and to which grants were made and contends
that the grants should have been made to universities as contributions to their
endowments for research and other purposes . The problem is clearly one of
the concentration of power in hands that could not possibly be competent
to perform the enormous task which the small staffs had the presumption to
undertake. This, says Flexner, was both "pretentious" and "absurd ." In my
opinion, it was worse than that . The staffs were guilty of favoritism . The
small committees who passed on the grants for projects and to individualss
were dominated by small coteries connected with certain eastern universities .
A Committee on Latin-American Studies, set up in the 1940's, for instance, was
filled with Harvard graduates . A single professor of history on the Harvard .
faculty had the decisive word regarding every request for aid presented by
historians .
By granting these subsidies to favorite individuals and favored ideas, the
foundations contribute to inequalities in opportunity and interfere with free
trade in ideas. They increase the power of favored groups to dominate our
colleges and universities . Men whose power exceeds their wisdom, or men
who are not guided by the principle of equality of opportunity, could become
a menace. If possible, under the terms of our Federal Constitution, these
foundations should either be taxed out of existence or compelled to make their
grants to colleges and universities, to be distributed by faculty committees of
these institutions . Even-handed justice may not prevail even then, because such
justice is rarely achieved in human relations . But a greater approximation
of even-handed justice will be made because these local committees will have
more intimate knowledge of recipients . This, as you know, is the fundamental
justification for decentralization of power, for the local autonomy which w as .
s o prominent in the thinking of our Founding Fathers .
Very sincerely,
J. FRED Rippy.
TAX-EXEMPT FOUNI)ATIONS 1197
STATEMENTS OF INDIVIDUALS
STATEMENT BY BERNARD L . GLADIEUX, OF THE FORD FOUNDATION, JULY 8, 1954
The purpose of this statement is to place on record the facts concerning alle-
gations made about me by Congressman Carroll Reece, of Tennessee, on July 27,
1953, in the course of a prepared statement to the House of Representatives sup-
porting H . R . 217 which authorized the current investigation of tax-exempt
foundations . Congressman Reece's statement concerning me has been incor-
porated in the record before this investigating committee in substantially its
original form . These allegations, imprecise as they were, generally parallel cer-
tain obscure charges originally made in 1950 by Senator George W . Malone, of
Nevada, concerning some of my official actions on loyalty and security matters
while serving in the Department of Commerce .
I am convinced that both Congressman Reece and Senator Malone have been
unwittingly misled by false and malicious innuendoes growing out of the per-
formance of my official duties . As an officer of the Federal Government I held
responsible posts of administrative control for over 10 years . It was necessary
during this time that I make many decisions concerning personnel, budget, or
organization matters which adversely affected the personal interests of partic-
ular employees and officials . I am satisfied that these wholly untrue allegations
had their origins in such administrative situations .
My statement which follows fully and accurately answers every allegation or
inference of Congressman Reece and Senator Malone . Fortunately, most, of the
cases and subjects discussed herein concern official actions taken by me or by
my superiors in the Department of Commerce and are verifiable by reference to
Government records and published congressional hearings .
I. EMPLOYMENT BACKGROUND
The Congressional Record of July 27 contains some factual inaccuracies con-
cerning my employment experience . I will therefore summarize my background
briefly .
Following graduation from Oberlin College in 1930 1 was for 4 years a teacher
and later principal of the American School in Japan, an institution established
by United States missionary groups in Tokyo . Then, after graduate training
in public administration at Syracuse University, I served (luring 1935-36 as
executive secretary of the City Manager League of Toledo, Ohio, my hometown .
Thereafter, I entered the employ of Public Administration Service of Chicago,
as a governmental consultant with major assignments successively in the State
governments of New York, Michigan, and Virginia, and in a number of Federal
agencies . These all dealt with reorganization and efficiency projects .
My Federal Government career in a civil-service capacity began at the United
States Bureau of the Budget in 1940, where I was first management consultant,
then Chief of the War Organization Section . My work there included planning
and setting up the new wartime agencies, examining and revising war agency
budgets and working on special White House assignments . Early in 1943, I
became administrative assistant to the Chairman of the War Production Board,
Donald M . Nelson. For a short period in 1944 and early 1945 I was associated
with the United Nations Relief and Rehabilitation Administration under Herbert
H . Lehman .
In 1945 I became executive assistant to the Secretary of Commerce under
circumstances described hereinafter . As a career officer,- I remained in that
post until 1950, serving under 3 successive Secretaries of Commerce-Henry A .
Wallace, W . Averell Harriman, and Charles Sawyer . Here I served as staff
director of operations with responsibilities for general management of the De-
partment, including budget control, personnel administration, and reorganization
work .
I resigned from the Government in November 1950, when Paul G . Huffman,
newly designated president of the Ford Foundation, offered me an attractive
position as one of his assistants . It involved substantially more salary than I
had been receiving in the civil service and gave promise of opportunities for
advancement far beyond what was possible for a career officer in Government .
My decision to leave public service was taken strictly on my own initiative
and was based solely on my belief that this opportunity was one that I could
not afford to pass up in the best interests of my family, as well as myself .
A fuller statement- by way of a detailed biography,' including a list of my
organization affiliations, is attached as a part of this statement.
II . LOYALTY CLEARANCE
The statement was madet by Congressman Reece that no investigation of
my loyalty had "ever been requested or made" while in the Federal service .
The contrary is the fact .
1 . Because of the sensitive nature of my duties in both the Bureau of the
Budget and the War Production Board it was necessary that I undergo special
investigation for clearance purposes during the war period . I am not fully
informed as to the character of these inquiries, but I believe they were extensive .
At any rate, I was given the requisite clearance and in both agencies had full
access to top-secret information and reports .
2. When W . Averell Harriman became Secretary of Commerce in 1946, one of
his early actions was to cause a comprehensive investigation to be conducted
by the FBI covering the senior officials of the Department immediately asso-
ciated with him . These investigations were not initiated as the result of any
allegations, but were undertaken simply as a precautionary security measure
to assure full protection at the upper echelons of the Department . The results
of the FBI inquiry in my case were stated in a memorandum from Secretary
Harriman dated August 12, 1947, as follows
"This memorandum is to place on record the fact that the Department's
loyalty review board, after conducting an investigation at my direction, found
nothing derogatory in the record of Bernard L . Gladieux which reflects adversely
upon him or raises any doubt as to his loyalty . On the contrary, the investi-
gation revealed a constant record of public service of a high order, vouched for
by outstanding Government officials .
"I approve the findings of the board, said approval to be placed in Mr .
Gladieux's official record."
3 . By direction of the Secretary of Commerce in 1948 I served as the official
representative and liaison of the Department of Commerce with the Central
Intelligence Agency. In this capacity I was authorized to handle top-security
information. It was necessary that I be given special clearance for this highly
confidential work in which I continued until I left the Government in 1950 .
I assume that such clearance resulted from the usual reinvestigation concerning
loyalty and security required of all those engaged in such work . My service
in this capacity is attested in a letter dated November 21, 1950, from Gen .
Bedell Smith, then Director of CIA, to the Secretary of Commerce on the occasion
of my leaving the Department. An excerpt from his letter follows
"I should like to take this opportunity to express my keen appreciation of
the consistent and highly valuable aid which Mr . Gladieux has rendered the
Central Intelligence Agency . His unfailing cooperation has been a great help
in solving some of the problems which we have faced during the past 2 years ."
4 . In 1952 and subsequently I served in a consultant and liaison capacity with
the Central Intelligence Agency involving certain highly sensitive matters .
Under its security standards I am certain that this Agency would not have
initiated this new relationship without further investigation and clearances
which gave me access to classified information .
III . ROLE IN LOYALTY APPEALS
Senator Malone has implied that I nullified adverse loyalty or security de-
cisions without authority and contrary to the interests of the Government .
Nothing could be farther from the truth . Here are the facts concerning my
relationship to the administration of the loyalty program during my years in
Commerce
In June 1948 I was formally directed by Secretary Sawyer, in addition to my
other duties, to serve as his special representative in hearing all appeals from
adverse decisions of the Department's loyalty board . This appeals procedure
was required by the provisions of Executive Order 9835 . In fulfillment of this
duty, I heard on appeal a substantial number of loyalty cases . The procedure
was to consider carefully the decisions of the loyalty board against the employee,
to screen and evaluate the FBI reports, to hold hearings at which the defendant
and his legal counsel appeared, and then to write a formal report and recom-
mendation to the Secretary .
Though 2 of the 3 members of our loyalty board were administrative subordi-
nates of mine, we scrupulously observed our respective functions and proper
relations in matters concerning loyalty appeals. Contrary to an inference by
Senator Malone in the Lee case that I might have influenced the loyalty board's


original clearance of him I followed a fixed policy of not discussing the substance
of this or any other case with loyalty board members during the time they were
under adjudication .
Several months after assuming this appellate responsibility the burden of
cases became so heavy, when coupled with my other duties, that I obtained the
Secretary's approval for the designation of the Director of the Field Service of
the Department to serve as my associate in reviewing these cases and to act as
joint presiding officer with me at the formal hearings . At my request the Solici-
tor of the Department and the Deputy Director of Personnel, who was in charge
of personnel security, also sat with me in the hearings on these cases . While
the responsibility was basically mine, I counseled with these associates closely,
and we invariably agreed on the recommendation to be submitted to the Secretary .
In making these recommendations on loyalty cases to the Secretary I exer-
cised my best judgment, keeping in mind the paramount interest of Government
security . It should be understood that during this period, under the terms of
Executive Order 9835, an employee could be separated on disloyalty charges only
if there existed "reasonable grounds" for a finding of present disloyalty . This
required a more positive finding and represented a policy more favorable to the
employee than the "reasonable doubt" standard which later became effective in
1951 . Obviously, some cases which were favorably decided in 1949 or 1950 under
the "reasonable grounds" standard might have been given an adverse decision in
1951 when the "reasonable doubt" standard was instituted .
The standards of evidence required by due process of law were in no way
called for in these proceedings. Nevertheless a finding of "present disloyalty"
under the "reasonable grounds" language of Executive Order 9835 necessarily
required some basis in tangible and credible information clearly adverse to the
defendant . This became a matter of judgment on the part of the reviewer, since
there could be no precise criteria for determining the weight of the evidence
normally available in connection with these cases . While governed by the
provisions of Executive Order 9835, I nevertheless felt it incumbent upon me to
determine questionable or borderline cases in favor of the Government-even
during that period when a more positive preponderance of evidence was required
for a disloyalty finding . This policy did not at the same time prevent me from
dealing with these cases in a manner fair and equitable to the employees con-
cerned . All my findings and recommendations as to these appealed loyalty
cases are a matter of record, and even with the advantage of hindsight I stand
by my decisions .
Regardless of final decision in the Department, all loyalty cases during the
period under discussion were subject to further appeal to or audit by the Presi-
dent's Loyalty Review Board-the final authority . During my service in the
Department of Commerce, no decision made by the Secretary pursuant to my
recommendation, either for or against the loyalty of any individual, was over-
ruled or reversed on subsequent appeal to or audit by the Loyalty Review Board .
The policy and attitude of the Department in connection with these loyalty
cases were perhaps best stated by Secretary Sawyer in a hearing before the
Senate Appropriations Committee on April 21, 1950 :
"In every case we have made a prompt investigation of any information which
came to us that would even justify an investigation, whether it would indicate
disloyalty or not .
"* * * as far as any dereliction in pursuing disloyal persons or any willingness
to defend them or protect them, there is not one word of truth in any such
claim. * * *"
In addition to scrupulous administration of the loyalty program, the Depart-
ment, under my supervision, inaugurated its own special - personnel security
program in 1948. This program, exceeded the requirements and standards of
the loyalty program and resulted in the elimination of many dubious employees
who were otherwise cleared under the official criteria established for loyalty .
IV. THE REMINGTON CASE
Senator Malone accused me of "violently defending" William Remington about
whose loyalty case there was much public comment in the period 1948-50. Con-
gressman Reece stated furthermore that I had engaged in "social contacts" with
Remington . Both of these statements and other innuendoes about my part in
this case are completely false . The facts are these
I had nothing to do with the selection or recruitment of Remington as a staff
member of the Department of Commerce in March 1948. As a matter of fact,
49720-54-pt. 2-17
I met him for the first time only after his case became the subject of congressional
investigation. Though we now know as a result of public disclosures that Rem-
ington was the subject of FBI information received in late 1945 linking him to
an espionage ring, I did not know nor was I personally informed of this fact
'until some time in June 1948. I am also confident that Secretary Harriman
was not alerted or otherwise informed about these suspicions and allegations
during his incumbency in Commerce. In fact a check by the Department with
the central investigative index maintained by the Civil Service Commission for
the entire Government revealed no derogatory evidence about Remington as late
as May . 1948.
To my knowledge Secretary Sawyer and Under Secretary Foster were first
-alerted by a communication dated May 11, 1948, from Attorney General Clark to
the effect that Remington was under FBI investigation on charges of espionage .
Following receipt and review of this FBI report in June, Secretary Sawyer im-
mediately placed Remington on inactive duty status . In July, after the facts
became more fully known to us and pending adjudication of his loyalty case,
I arranged for Remington's formal suspension from the Department of Commerce .
On August 5, 1948, as spokesman for the Department, I appeared before the
Senate Investigating Committee, Senator Homer Ferguson serving as chairman,
to describe the circumstances leading to this suspension and to assure the com-
mittee that we were exercising proper vigilance in such cases as soon as we were
given an FBI alert . I was interrogated on this occasion as to why the Depart-
ment of Commerce was not advised by the FBI or the Department of Justice
that Remington had been under investigation since 1945 and could only reply
that I assumed the FBI had its own reasons for keeping Remington under surveil-
lance without general disclosure of this fact .
The matter of Remington's loyalty was never under the jurisdiction of the
Department of Commerce, and I, therefore, had no part in the decisions con-
cerning this matter. The adjudication of this case was the responsibility of the
Civil Service Commission according to the loyalty regulations existing at the
time .
In the fall of 1948 the Regional Loyalty Board of the Civil Service Commission
found Remington disloyal . On appeal the President's Loyalty Review Board in
February 1949 overruled this adverse decision and declared there was no reason-
able grounds for believing Remington disloyal . The Board thereupon ordered
the Commerce Department to reinstate him in his former position and to his
former status . It was my responsibility to carry out this order on behalf of
the Secretary . I took the precaution of placing security restrictions on Reming-
ton and located him in a nonsensitive position in his former organization, the
Office of International Trade, with duties completely unrelated to his former
responsibilities . In July 1949 I took further steps to minimize his duties and
reduce him in civil-service grade, since his usefulness was now greatly limited .
.' The Remington case illustrates the earlier difficulties and uncertainties sur-
rounding the handling of security cases following clearance on loyalty grounds .
In 1949 there was no clear legal authority and no civil-service standards or pro-
cedures for the dismissal of those considered to be of dubious security as this
term is now being used . Actually, it was not until about August 1950 that the
Congress enacted legislation, which had been initiated by the Department, author-
izing the Secretary of Commerce to effect security dismissals in his discretion
and without regard to civil-service regulations . Had we been vested with such
authority earlier Remington's case could have been disposed of with dispatch
in 1949.
A year or more after Remington's reinstatement new derogatory information,
which eventually formed the basis for his indictment, was developed on him by
the House Committee on Un-American Activities . I requested a transcript of
this information, in a letter from me to Chairman John S . Wood dated May 5,
1950, and obtained it from the committee. After review of this new information
and consideration of the entire case, Secretary Sawyer decided Remington must
somehow be removed from the Government . After discussion with me, and
with the Secretary's concurrence, I called Remington and his attorney into my
office on May 26, 1950, and, with the Director of Personnel Operations as a wit-
ness, demanded his resignation. (The forced resignation technique was much
simpler, if successful, than the slow and uncertain civil-service separation proce-
dures in the absence of the summary dismissal authority referred to above .)
Remington refused . Accordingly, I then signed and filed formal charges for his
dismissal in a letter from me to him dated June 5, 1950. Thereupon, a few days
later, Remington resigned from the Department .

TAX-EXEMPT FOUNDATIONS 1201 .

The first time I ever met or even saw Remington or had any relationship with
him was after his suspension in 1948, when he came to my office in connection
with some aspect of this action . My subsequent relations were also strictly
official, and I never met him outside my office . I certainly had no social contacts
with him at any time or had any personal interest in his case ; nor have I ever
defended his character or conduct before congressional committees or otherwise .
This was an involved case to handle in view of Remington's civil-service rights
under the Veteran's Preference Act and his loyalty clearance by the Loyalty
Review Board . It properly fell to me to handle in view of my position .
V. THE LEE CASE
Congressman Reece, claimed that I had "social contacts" with Michael E . Lee
about whose loyalty case there also was much public comment at the time .
Senator Malone stated that I nullified adverse decisions regarding Lee, accused
me of "violently defending" him and made other insinuations concerning my role
in this matter . The record shows that these allegations are false and have
no foundation in fact.
My first contact with the Lee case was to initiate the Department's original
request for a full-scale FBI investigation of this employee as follows : Sometime
in October 1948 I recall the Department's Chief Investigations Officer bringing
to me an unidentified statement, which he had in turn received from a staff
member of the House Committee on Un-American Activities, citing Lee's back-
ground and raising questions as to his character and suitability . I believed this
information, though sketchy, warranted inquiry and accordingly directed the
investigations officer to turn it over to the FBI .
A few weeks later I received further information about Lee from a reliable
private source. This information in particular, and when coupled with that
received earlier, disturbed me in view of Lee's sensitive position in our Office
of International Trade since it raised in my mind serious question as to his
loyalty or at least his security status . Accordingly, on this occasion some-
time in November 1948 on my own responsibility I directed our investigations
officer to make a formal request to the FBI for a full-scale investigation . Shortly
thereafter the assigned FBI agent came to see me, and I informed him of my
information and its source .
This all led to the submission some months later of a comprehensive FBI report
on Lee which was turned over to our loyalty board . At no time in all the sub-
sequent consideration of Lee's case, however, did I myself have any part in
adjudicating its loyalty aspects .
After the usual process of charges and hearings the Department's loyalty
board in July 1949 made a favorable decision as to Lee's loyalty-a decision
confirmed by the Loyalty Review Board on audit. However, while clearing him
on loyalty charges the Department's board recommended that careful study
be given Lee's fitness for holding a sensitive position in which he would have
access to classified materials . This recommendation came to me in accordance
with normal procedure . Since Secretary Sawyer was by now fully familiar with
the facts concerning Lee, and in view of the nature of this particular case, I
referred the matter to him . He informed me that he had decided no security
restrictions should be imposed on Lee, and I so advised our personnel office in
a memorandum dated August 8, 1949 . I believe the Secretary again reviewed
the matter of Lee's security status in February 1950 and found no reason to
reverse his earlier decision .
Subsequently further information from the FBI came to the attention of the
Department causing our loyalty board to file new loyalty charges against Lee
in March 1950. This led to an adverse finding against Lee in September 1950.
Secretary Sawyer personally assumed jurisdiction over the appeal submitted
by Lee since again he alone could make a decision in a case of such public interest .
In November 1950 the Secretary overruled the loyalty board and cleared Lee
of disloyalty charges. The Secretary reached his own decision, and I did not
advise on it this all taking place in the period when I was preparing to leave
Government.
My connection with the Lee case principally dealt with the pressing of charges
concerning his administrative capacity . He was a constant source of personnel
problems because of his failure to exert proper direction of his staff in the Far
Eastern Division, Office of International Trade . Several administrative actions
were brought against Lee, the course of these paralleling the separate loyalty
proceedings during 1950 . After a series of charges and countercharges involving
Lee and his associates in the Office of International Trade and in consideration
of all the facts in the totality of this case Secretary Sawyer came to the decision
that steps must be taken to remove Lee from the Department . Accordingly, after
discussion with me and with his approval, I called Lee into my office on May 26,
1950, and, with the Director of Personnel of the Department as a witness, de-
manded his resignation from the Department. (Here again we were handicapped
in dealing with such cases by the absence of summary dismissal authority .) Lee
refused to resign, he said, until he had been given loyalty clearance by the
Secretary . On June 1, I again demanded Lee's resignation . When he again re-
fused, I signed and issued formal charges on administrative grounds for his dis-
missal from the Federal service in a letter to him under date of June 1, 1950 . I
filed additional charges on July 17 . The required civil service hearing on these
several charges was never held, because of Lee's certified illness . These charges,
however, later facilitated his forced resignation .
When Secretary Sawyer advised Lee of his final clearance on loyalty charges in
November 1950, I believe that the Secretary then threatened to use his recently
enacted summary dismissal powers unless Lee resigned . Having been finally
cleared on loyalty grounds, he resigned at last from the Government .
I had nothing to do with Lee's entrance into Government employment and had
no dealings of any kind with him until it was necessary that he see me in my
office on various occasions in connection with his case . My relationships were
strictly official and in line of duty . I had no personal interest in him and cer-
tainly at no time engaged in social contacts with him .
Senator Malone has repeatedly stated that I appeared before the Senate Com-
mittee on Interstate and Foreign Commerce and defended Lee in 1950 . This is
simply contrary to fact . I never appeared before this committee in connection
with the Lee case, as the record of this particular hearing will show, and at no
time before this or any other committee did I undertake to defend Lee's character
or conduct.
As to Congressman Reece's reference to the fact that I never appeared before
the Committee on Interstate and Foreign Commerce to answer Senator Malone's
charges about me in connection with the Lee matter, I should like to point out
I was never requested to appear before this committee as were some other officials
of the Department of Commerce . Lee was the one being investigated by the
committee under Senate Resolution 230-not I . Furthermore, Under Secretary
Whitney's authoritative statement, when testifying before this committee on
March 30, 1950, made the circumstances of Lee's security clearance, which were
at issue, quite clear .
This was another highly complicated case in civil-service terms and much
confusion surrounded its course . Many differences of opinion were expressed at
different stages as between those familiar with the case . I believed then as I
do now that the decision of Secretary Sawyer to separate him was justified and
proper .
VI. RELATIONSHIPS WITH HARRY S . MA0DOFF
Congressman Reece on July 27, 1953, stated that he had been advised by a
reliable and responsible source that I had engaged in social contacts not only
only with Remington and Lee, but also with Harry S . Magdoff, who was a sub-
ordinate staff member in the Office of Program Planning for about a year during
the time I was in the Department of Commerce .
I have never at any time engaged in personal social relations with Magdoff
by any stretch of that term as it is universally understood . I have searched my
memory and believe the only association with Magdoff which could conceivably
be twisted into alleged social contact concerns my presence on 1 or 2 occasions
as an invited guest, because of my official position, at a staff luncheon held by
the Office of Program Planning at which Magdoff was also present along with
the other employees of this unit . I also remember noting his presence at a local
group meeting of the League for Women Voters back during this period . But
there was no basis of mutuality for social relationships, and I simply didn't
associate with him outside the office-in fact, I didn't know him very well even
there .
I had nothing to do with Magdoff's employment in the Government and did
not meet him until this time (1945 or 1946) . He was not under my direction
and my official contacts with him in Commerce were not extensive, though I
saw him in line of duty now and then . I have not seen him since Commerce
days .


Subsequent to Magdoff's resignation from the Department in December 1946,
information from the FBI about him came to my attention. In accordance with .
our established procedure, his name was flagged in our Personnel Office for
purposes of blocking reemployment in the future . This was the first that
I was aware of the fact that he was considered a "suspect" person . I did not
know that he had been the subject of FBI inquiry and comment as early as
1945 until recent public disclosures. I am certain that neither Secretary Har-
riman nor Under Secretary Foster were likewise made aware of the existence
of this adverse information about Magdoff until after his resignation from
the Department .
VII . RELATIONSHIP WITH PHILIP M . HAUSER
Congressman Reece claimed that I also engaged in social contacts with Dr .
Hauser and drew an unfavorable inference from this relationship . I con-
sidered Dr. Hauser, who was for 2 or 3 years Chief of the Office of Program
Planning in the Office of the Secretary, a respected associate . I came to know
him well in the office and had a high regard for his capabilities . I was familiar
with the facts involved in his FBI report . More importantly, I was aware that
he had been given full loyalty and security clearance following review by the
Department's loyalty board. He enjoyed the confidence of successive Secretaries
of Commerce and I likewise have had no reason at any time to question his
loyalty or his security. (Incidentally, as I recall it, Dr . Hauser's case prin-
cipally involved allegations concerning other members of his family as well as
a matter of confused identities .)
VIII . RELATIONSHIP WITH HENRY A. WALLACE
Senator Malone has claimed that I was a protege of Henry A. Wallace,
former Vice President. This statement, with its derogatory insinuation, has
been repeated by Congressman Reece.
I have been no man's protege.
I was originally recommended to Mr. Wallace in 1945, when he became Secre-
tary of Commerce, by Harold D . Smith, Director of the United States Bureau
of the Budget. I had met Mr . Wallace a few times earlier in connection with
my duties at the Budget Bureau, when I was assigned to assist in establishing
the new Board of Economic Warfare of which he was Chairman . But I knew
him only slightly before 1945 ; I had not been associated with him in the Depart-
ment of Agriculture at any time .
As his executive assistant at Commerce for about a year and a half I was con-
cerned exclusively with the internal operations of the Department and never
played any part in any of Mr . Wallace's political speechmaking or other polit-
ical activities . I did not approve of his 1948 campaign for the Presidency and
have had practically no contact with him since 1946 . On 2 or 3 occasions in
that time he has phoned me to inquire as to my recollection concerning factual
matters relating to his incumbency as Secretary of Commerce, and I have had
2 chance encounters with him since coming to reside in the New York area in 1951 .
IX . CONGRESSIONAL HEARING
Reference was made in the July 27, 1953 Congressional Record to my appear-
ance before the House Appropriations Subcommittee on February 27, 1950 .
This hearing was called to inquire into the policies and practices of the Depart-
ment of Commerce regarding loyalty and security . As the officer in general
charge of administration, including security matters, it was my function to
serve as official spokesman .
I presented to the committee facts and statistics which outlined the "tough,
but fair" policy we had adopted. In addition to advising them as to the sub-
stantial number of employees already released on loyalty grounds, I explained
that on our own initiateive we had extended the program beyond the require-
ments of Executive Order 9835 to provide for the designation of security risks
and for dismissals on security grounds wherever this was feasible . More
specifically I was able to report that as of February 21, 1950, a total of 71
Commerce employees had been dismissed or otherwise separated on loyalty or
security grounds as a consequence of our departmental action following the
receipt and consideration of adverse FBI information submitted pursuant to the
new loyalty program .
I explained the legal and civil-service difficulties we were encountering in deal-
ing with security cases which had been cleared on loyalty grounds and indicated
that the Department needed, and was seeking, legislative authority which would

empower the Secretary to dismiss dubious employees in his discretion without

reference to the usual civil-service procedures . There is reason to believe that
my testimony on this occasion helped obtain this summary authority as a rider
to our pending appropriation bill .
In spite of the above record of the Department, some of the committee members
protested at my refusal to reveal certain information concerning individual cases
and claimed I was not cooperative with them . I was obliged to explain repeat-
edly that I was under specific instructions from the White House, reinforced by
instructions from the Secretary of Commerce, to reveal nothing but broad sta-
tistics and general policies and to refrain from comment on, or information about,
specific loyalty cases . (Incidentally, President Truman's Executive order pro-
hibiting the release of loyalty information to congressional committees has not
been rescinded by President Eisenhower, and it continues in full force and effect .
The committee was adamant in its attitude, however, and insisted that I discuss
specifics. Since under the terms of my instructions I could not accede to this
demand, some committee members were obviously not completely satisfied .
x
In conclusion, I wish to state that, like any other loyal American, I deeply
resent these false and malicious insinuations . I am proud of my career in the
public service . I have nothing to conceal. I will stand by the record of my
official actions and decisions .
STATE OF NEW Yonic,
County of New York, ss :
Bernard L. Gladieux, being duly sworn on his oath, deposes and says that he
is the person who subscribed his name to the foregoing statement and that the
matters and facts set forth in said statement are true .
(Signed) BERNARD L. GLADIEUX .
Subscribed and sworn to before me this 13th day of July 1954 .
(Signed) JANICE B. LA VINE,
BIOGRAPHICAL STATEMENT OF BERNARD L. GLADIEUX, OF THE FORD FOUNDATION,

JULY 7, 1954
BIRTH, FAMILY, RESIDENCE

My name is Bernard Louis Gladieux . I was born April 12, 1907, in Toledo,
Ohio.
My father, Victor Modest Gladieux, resides in Toledo at 724 Utah Street where,
together with my mother until her recent death, they lived for almost 50 years .
He is of French-Irish descent, his paternal ancestors migrating to this country
from Alsace, France, about 1832 . Until his retirement a few years ago, my
father was employed by the City Water Department of Toledo . My mother,
Anna Cook Gladieux, was of English descent and a member of the Daughters of
the American Revolution .
I married Persis Emma Skilliter, also of Toledo, in June 1930 . We have 4
sons : Bernard, Jr., age 17 ; Russell, 14 ; Larry, 10 ; and Jay 7 . My family and
I now live at 3 Walworth Avenue, Scarsdale, N. Y.
EDUCATION
I attended Navarre School, a Toledo public school, through the eighth grade
and was graduated from Waite High School of Toledo in 1926 . In high school
I participated in athletics and during my senior year was president of the stu-
dent council, president of the Hi-Y Club, and a class officer . I attended and later
joined Trinity Episcopal Church at this time .
In the summer of 1926, following graduation from high school, I was selected
as 1 of 3 youth representatives from Ohio to attend the first world conference
of YMCA's in Helsingfors, Finland .
I entered Oberlin College in the fall of 1926 and received an A . B . degree in
1930. My major course of study was American history. At Oberlin I partici-


pated in athletics and was president of the college YMCA, a member of the men's
senate (student governing body), and a founder of the Outing Club . In my senior
year, I was elected to Phi Beta Kappa .
Daring the summer of 1929, while still at Oberlin, I received a fellowship
covering travel in Europe and study at the Zimmern School of International
Studies, at Geneva, Switzerland .
In 1934, I took graduate training in public administration at the Maxwell
School of Citizenship and Public Affairs of Syracuse University . Later, following
submission of a thesis, I was awarded a master of arts degree in public admin-
.
istration
CAREER
1930-34-American School in Japan : Teacher and principal
Upon graduation from Oberlin in 1930, I accepted a position as teacher in the
high-school department of the American School in Japan, located in Tokyo . This
private school was established by United States missionary groups to educate
the American and other English-speaking children of the foreign resident com-
munities in Tokyo and Yokohama. My principal teaching assignments were
American history and government, European history and physics ; I also coached
the school's athletic teams . Mrs . Gladieux taught in the elementary department
of the school .
In 1933 I was appointed principal of the school by its board of trustees, a
position that I agreed to hold for 1 year since I had already delayed my planned
return to the United States . As principal I was responsible not only for academic
administration, but for the business management of the institution as well .
1934-35-Graduate work at Syracuse University
Upon returning from Japan in the summer of 1934 I entered graduate school
at Syracuse University intending to train for and eventually enter public service.
This course of training was interrupted early in 1935, when I was invited by a
group of civil leaders in Toledo to become executive secretary of the City Manager
League .
1935-36-City Manager League of Toledo, Ohio : Executive secretary
This civic organization was dedicated to revamping and modernizing the
municipal government of Toledo . I was responsible for planning and directing
its work . The league successfully sponsored a new city charter, electing a
majority of the new city council, and instituted a number of improvements in
municipal management and city finances .
Upon completion of this program of municipal reform early in 1936, I returned
briefly to Syracuse University in order to complete my course work in public
administration .
1936-Regents' education inquiry: Research associate
In April 1936 I became research associate on the staff of the regents' inquiry
into the character and cost of public education in the State of New York . Here
I conducted field surveys covering the administrative organization and business
management practices of 15 New York State school districts, derived and analyzed
data on unit costs of education, and assisted in designing the improved budgeting,
accounting, and other administrative practices recommended in the published
reports of this inquiry.
1936-40-Public Administration Service : Management consultant
I had been associated with Public Administration Service during the course
of the regents' inquiry and at the conclusion of this work was invited to join
its permanent staff. Public Administration Service is a nonprofit corporation,
with headquarters in Chicago . It provides technical consultant services on a
contract basis to Federal, State, and_ local governments .
From December 1936 to June 1937 I assisted in preparing and executing plans
for the reorganization of the New York State Department of Social Welfare,
including consolidation of the functions of the temporary emergency relief admin-
istration . I was also responsible for designing a system of district offices and
for preparing and presenting a budget to the Governor's office for the reorganized
department.
During this same period I developed and taught a course on "The Organization
and Administration of Public Education" to the graduate class in public admin-
istration at Syracuse University.
From July 1937 to March 1938 I was engaged on a project initiated by the
Governor of Michigan, Frank Murphy, the purpose of which was to develop an
improved system of financial administration for the State government . I was
specifically concerned with formulating and installing revised budgetary pro-
cedures to control State expenditures more effectively .
I was next assigned to the Federal Social Security Board where I developed
and installed revised plans of administrative organization and procedures for
the Bureau of Old Age Assistance. This program included simplified adminis-
tive methods, more economical procedures for adjudicating and paying insurance
benefits, and plans for decentralizing operations to the field .
As consultant to the Administrator of the United States Housing Authority,
Nathan Straus, from October 1938 to February 1939, I was charged with the
development and installation of a revised plan of organizaiton for this public
housing agency . I recommended a number of basic changes in both line and
staff functions and upon approval of these by the Administrator, prepared the
necessary implementing orders . I also supervised the preparation of special
reports on financial administration and personnel practices .
I was next invited to serve as consultant to the Administrator of the Wage
and Hour Division of the Department of Labor which was having considerable
program and management trouble administering the Fair Labor Standards Act .
I was able to institute several organizational and procedural changes including
the development of a revised plan of regional administration . Later, when in
the Bureau of the Budget, I was requested to continue my work here, under
Budget Bureau auspices now, however, since the situation was of concern to the
White House. Major personnel and program changes became necessary .
Harold D . Smith, newly appointed Director of the United States Bureau of the
Budget arranged with Public Administration Service to use my services during
the period from June 1939 to March 1940 . Here I carried out a number of
special assignments : (1) Served as adviser to the Administrator of the Federal
Works Agency in the developmental stages of this new agency ; (2) supervised a
survey of the organization and administration of the Bituminous Coal Division at
the request of the Secretary of the Interior ; (3) advised the Secretary of Labor
on the continuing problems of administering the Fair Labor Standards Act .
While working in the Bureau as above, I also carried on various activities for
my employer, Public Administration Service. Thus, I gave general supervision
to a survey of the administration of Virginia State welfare services undertaken
at the request of Governor Price . Recommendations were submitted for legis-
lative action and for the internal organization of the department of welfare . I
also developed a plan of administrative organization and formulated an opera-
tions budget for the newly established New York State Division of Housing .
1940-43-United States Bureau of the Budget : Chief, War Organization Section
In March 1940, I resigned from Public Administration Service to accept a
full-time position as chief investigator with the Budget Bureau . At about the
same time I filed applicaiton for open competitive civil-service examinations to
qualify for budget examiner and management analyst . I was given a sufficiently
high rating on these examinations to permit my appointment shortly thereafter
as Chief Budget Examiner with full civil-service status .
When President Roosevelt established the National Defense Advisory Com-
mission in June 1940, I was designated as the representative of the Budget Bureau
in observing its operations, maintaining liaison between it and the Bureau and
advising on management problems.
As the defense effort merged into preparation for allout war, I was placed
in charge of a special staff within the Budget Bureau into which were centered
all new activities dealing with the war effort . My staff and I were responsible
for planning the development and establishment of the new war agencies, sub-
mitting proposals through the Budget Director to the President . Thus during
1941 and 1.942, I prepared or supervised the preparation of and cleared and
negotiated the Executive orders which the President signed establishing, defining
the functions of, and delegating powers to : the War Production Board, the
Office of Price Administration, the Board of Economic Warfare, the Office of
Strategic Services, the Office of Civilian Defense, the Lend-Lease Administration,
the Office of Scientific Research and Development, the Office of War Informa-
tion, the Office of Defense. Transportation, and others.
My group continued working with these emergency agencies after they were
created by helping with their organization and staffing problems . All budget
requests were reviewed, revised, and approved by my staff in the Budget Bureau .


As the war organization evolved our principal function came to be to exercise
a continuous surveillance over the war agencies on behalf of the Executive Office
of the President, in order that program gaps, jurisdictional conflicts, organiza-
tional aud,daadership breakdowns u ght , e detected, reported, and acted upon
by the Budget Director or President before serious damage was done . Pro-
grams and operations were continuously being evaluated for their contributions
to the war effort . Frequently changes in personnel, program policy, and basic
organization were recommended to the Budget Director for submission to the
President.
During this time I was also frequently on special assignment to the White
House working with Judge Samuel I . Rosenman . Judge Rosenman was then
serving as special assistant to the President helping to resolve many of the diffi-
cult situations arising from the unusual pressures, tensions, and personalities
of wartime Washington . I assisted him in working out proposals for the Presi-
dent concerning the assignment of major war powers as between competing
administrators and in developing organizational plans and mechanisms for co-
ordination of war policies at the White House level .
1943-J4-War Production Board ; Administrative Assistant to Chairman
In January 1943 I was invited by Donald M . Nelson, Chairman of the War
Production Board, to become his chief administrative assistant . In this capacity
I served as Mr. Nelson's principal adviser and assistant in the administration
of the War Production Board .
I was directly responsible for organization planning, budget and fiscal admin-
istration, personnel management, business services, and operating procedures
for the entire Board . Five divisions covering these activities were under my
direction. I was also Chairman of the Administrative Council .
Much of my time at WPB was devoted to adjusting its organization to meet
new program needs arising from the war particularly with regard to plans for
the Normandy invasion. I was also engaged in directing an effort to streamline
the agency and reduce its excessive staff . By a process of freezing recruitment,
consolidating functions, reducing budgets, and generally tightening up, we were
able to report to the House Appropriations Committee in April 1944 that the
1944 appropriation of approximately $89 million had been reduced to $69 million
for fiscal 1945 . In personnel terms I was able to report that the total WPB
staff of 22,000 in January 1943 hadbeen reduced to 17,500 by March 1944 .
1944-45-United Nations Relief and Rehabilitation Administration
In August 1944 I accepted an invitation to join the staff of the newly formed
United Nations Relief and Rehabilitation Administration . My first task was
to make some surveys toward improving certain management and fiscal aspects
of the organization. Then Herbert Lehman, Director General of UNRRA re-
quested and urged me to serve as Deputy Director of the Bureau of Areas, which
was responsible for all relief operations abroad . I was informed that the
program was being seriously impaired because of poor direction of this Bureau
by its Chief, Michail A. Menshikov, a Soviet national . I accepted this post with
reluctance, and only because I considered it a matter of duty ; then was re-
quested to initiate and expedite the work in liberated areas of Europe and the
Far East . I was able to make some progress and improvements in the situation,
reporting directly to Governor Lehman on critical decisions such as the forma-
tion of country missions .
At the end of 3 months, however, I asked Governor Lehman to be relieved of
this assignment since I saw no hope of achieving the degree of improvement
the situation called for as long as the obstructionist and dilatory tactics of the
Director of the Bureau of Areas continued . The international political situa-
tion apparently did not permit the removal of this senior representative of the
Soviet Union at that time . I was permitted to withdraw in accordance with
the agreement made when I originally consented to take on the task .
During most of the remainder of my time in UNRRA I served as Assistant
and Acting Director of the Bureau of Finance and Administration.
1945-50-United States Department of Commerce : Executive Assistant to the
Secretary
In March 1945 I received an offer from Henry A . Wallace, newly designated
Secretary of Commerce, to serve as his Executive Assistant . I left UNRRA
to accept this post for which I had been recommended by Harold D . Smith,
my former chief in the Bureau of the Budget . I continued in this position
under Secretaries W . Averell Harriman and Charles Sawyer until November
1950 .
The following excerpt from my official position description indicates the

_scope of my duties during my tenure in the Department of Commerce :
"As the Secretary's principal career assistant and staff director of operations
for the entire Department, the incumbent of this position provides overall direc-
tion, guidance, and coordination in the Secretary's behalf and pursuant to his
general policies for all programs of the Department, to obtain optimum effi-
ciency, economy, and effectiveness in the administration of the affairs of the
Department and its constituent bureaus ."
My principal effort during my 6 years in this large and diverse Department
was to work toward its revived importance following the neglect of the war years
and to help make it of more dynamic and efficient service to , the business and
industrial community . Much of my work centered around the $1 billion annual
budget : its development, approval, adjustment, and control . Budget requests
and new programs were subject to my approval on behalf of the Secretary before
submission to the Budget Bureau or to congressional committees .
Another activity which took considerable of my personal time was the work
incident to the Hoover Commission. I was designated by the Secretary as the
official liaison and representative of the Department in regard to this Commis-
sion while it was formulating its recommendations . Subsequently, during the
period of implementation and installation, it was my responsibility to work out
the transfers of functions and agencies and to assure their smooth integration
into the Department's structure.
In addition to these duties, I was responsible for personnel management in the
Department covering some 55,000 employees. With to inauguration of the loyalty
program in 1948, the Secretary of Commerce designated me as his representative
in hearing appeals from casse determined adversely by our Loyalty Board under
Executive Order 9835. This, together with the related security program, came
to demand an increasing amount of my official time . I also served as the central
liaison and representative of the Department in relation to the Central Intelli-
gence Agency .
NoTE.-During my years of service in the United States Government, I invari-
ably and without exception received civil service efficiency ratings of "excellent"
from my various superiors .
1950 to date-Ford Foundation
In November 1950 Paul G . Hoffman, newly designated president of the Ford
Foundation, invited me to become associated with him as assistant to the presi-
dent . I accepted, as this offered me challenging work at an attractive salary
with good prospects for higher advancement than a career officer could expect in
the Government. During Mr . Hoffman's incumbency I served as chief of the
.New York office of the foundation in which were centered the operational activi-
ties of the organization .
GENERAL PROFESSIONAL
Following the election of President Eisenhower in 1952 I was requested to serve
, as a consultant to the committee headed by Mr . Nelson Rockefeller dealing with
reorganization of the Federal Government . I assisted the committee in develop-
ing its plans and in outlining some of the principal management, organization
and civil-service problems which would confront the new administration (tem-
porary assignment) .
During the recent school year, in association with Prof . Arthur MacMahon,
I conducted a graduate seminar on the subject American Political Institutions
for the department of public law and government at Columbia University .
At Oberlin on October 31, 1953, I was awarded an alumni citation "in recogni-
tion of outstanding achievements and services which reflect honor upon Oberlin
College."
My writings have all been in the field of public administration. The following
articles of mine have been published
1 . "Administrative Planning in the Federal Government," Advanced Management
1940
2. "Top Management in the War Agencies," graduate school, Department of
Agriculture, 1949
3 . "Civil Service versus Merit," Public Administration Review 1952
4. "Civil Service at the Crossroads," Good Government 1953 .


.
MEMBERSHIPS AND AFFILIATIONS
In the political sphere I consider myself an independent . Since coming of
voting age I have been registered at different times both as a Democrat and as a
Republican and have contributed funds to both parties dependent on my con-
victions at the time.
My other affiliations have been largely limited to religious, professional, or
social organizations in which I have had a direct and tangible interest .
During our 4 years residence in Japan Mrs . Gladieux and I were members
of Tokyo Community Church . During our residence in Maryland, my wife and
I helped establish and attended a community church-Pilgrim Lutheran Church-
though we are not Lutherans ourselves. Since resident in Scarsdale, N . Y ., my
wife and I have joined Hitchcock Memorial Presbyterian Church .
I have searched my memory and my records going back to the 1935 period
when I reestablished myself in Toledo following residence in Japan and to the
very best of my knowledge and recollection, the following constitutes a compre-
hensive list of my organizational memberships and affiliations during this period.
National Municipal League, 1936-40, approximately .
International City Manager's Association, 1936-40, approximately .
Governmental Research Association, 1936-39, approximately .
Ys Men's Club, YMCA, of Toledo, Ohio, 1935-36 .
American Society of Public Administration (charter member), 1938 to date .
Group Health Association of Washington, D . C .,, member board of directors,
1944-47, approximately .
Kenwood Golf and Country Club, Chevy Chase, Md ., 1946-50 .
YMCA of Washington, D . C., 1945-47.
Advisory Council on Public Administration of the Graduate School of the De-
partment of Agriculture, 1945-46, approximately .
Potomac Appalachian Trail Club, 1946-48 .
Appalachian Mountain Club, 1946-48 .
Oberlin Alumni Club of Washington, D . C., president,, 1946-48 .
Alumni Board of Oberlin College, treasurer, 1945-48 .
Board of managers of the YMCA schools of New York City, 1951 to date .
Planning committee of Board of Education of Scarsdale, New York, 1952.
Town Club of Scarsdale, New York, 1953 to date .
Men's Club of Hitchcock Memorial Church, 1951 to date .
Greenacres Association (neighborhood association in Scarsdale) 1951 to date .
Advisory council of the department of politics, Princeton University, 1953, to date .
Advisory group, Japan International Christian University, 1953 to date .
Various parent-teacher's associations .
Though it represented a completely futile exercise, I have carefully reviewed
the Attorney General's list of subversive organizations, as well as the broader
Guide to Subversive Organizations of the House Committee on Un-American
Activities, I can say without reservation that I am not now and never have been
a member of any such listed organization, nor have I otherwise been associated
or affiliated in any way therewith . I can make the same statement on behalf of
my wife .
Furthermore, I should like to state for the record and under oath that I am
not now nor ever have been a member of the Communist Party or any of its affil-
iates or sympathetic in any way with its objectives or doctrines .
Bernard L. Gladieux being duly sworn on his oath deposes and says that he is
the person who subscribed his name to the foregoing biographical statement and
that the matters and facts set forth in said biographical statement are true .
(Signed) BERNARD L . GLADIEUx .
STATE OF NEW YORK,
Subscribed and sworn to before me this 13th day of July 1954 .
(Signed) JANICE B . LAVINE,
STATEMENT OF JOSEPH H . WILLITS IN REPLY TO INQUIRY OF GENERAL COUNSEL

OF THE SPECIAL COMMITTEE To INVESTIGATE TAX-EXEMPT FOUNDATIONS DATED
AUGUST 4, 1954
My name is Joseph H . Willits . My residence address is North Greenwich
Road, Armonk, N . Y. I was director of the division of social sciences of the
B .ockefeller Foundation from 1939 until my retirement on June 30, 1954, in accord-
ance with the bylaws of the foundation .
This statement is made in response to a letter which I have received from Mr .
Rene A. Wormser, general counsel of the committee, dated August 4, 1954, con-
taining the following paragraphs
"It is my understanding that following the statements made by Mr . Kohlberg
regarding the Institute of Pacific Relations you agreed, on behalf of the Rocke-
feller Foundation, to have his charges investigated . However, at a later date
you informed Mr . Kohlberg that no such investigation was to be made, explain-
ing this seeming reversal by a statement to the effect that the Institute of Pacific
Relations was undertaking an investigation of its own .
"The chairman has asked me to take this matter up with you and I would
appreciate your advising me as soon as you conveniently can whether the above
statement is an accurate resume of what took place ."
The above statement is not an accurate resume of what took place .
The statement that I "agreed, on behalf of the Rockefeller Foundation, to
have his (Mr. Kohlberg's) charges investigated" appears to be based upon testi-
mony given before the special committee by Dr . Kenneth Colegrove on June 8,
1954 . This witness testified that he could not understand, "when Alfred Kohl-
berg was able toget the consent of one of the very high officers in the Rockefeller
Foundation, why the foundation would not make an investigation of the IPR .
* * * We ought to have the whole story of why the Rockefeller Foundation
failed to make the investigation in 1945" (transcript, p. 1235) . The chairman
later asked : "To whom was Kohlberg's request for an investigation made,
Professor?" Dr . Colegrove answered
"It was made to Fred Willetts, an official of the Rockefeller Foundation, one
of the outstanding men, a man of great integrity and a man of competence and
scholarship . I have great respect for Fred Willetts, and he must have had a
good reason for not investigating . But that reason, it seems to me, ought to be
told to the American people" (transcript, p. 1238) .
The fact of the matter is that I never "agreed, on behalf of the Rockefeller
Foundation, to have his (Mr . Kohlberg's) charges investigated." I suggested
to both parties that they jointly select an impartial committee of inquiry to hear
and determine the charges, and I acted as an intermediary in trying to bring
about an agreement between them on terms of reference and procedure . The
attempt broke down when the IPR rejected the proposal and decided to act on
its own . There was no "seeming reversal" on my part . I proffered my help to
bring the parties into agreement on the terms and conditions of an independent
inquiry into the charges . I continued to use my best efforts in that direction
until the IPR declined to go further with my proposal . I then notified Mr .
Kohlberg that the IPR (not I and Dot the Rockefeller Foundation) had broken
off the negotiations . That is the sum and substance of this particular incident .
As will be noted later, however, the Rockefeller Foundation, in coming to a
decision as to whether or not further support should be given to the IPR, made
through its own staff, and for its own purposes, a careful inquiry into the IPR
situation .
The particular incident about which counsel for the committee inquires was
the subject of testimony by both Dean Rusk, president of the Rockefeller Foun-
dation, and Mr . Kohlberg during the hearings before the Cox committee in 1952 .
Mr. Rusk's testimony (Cox committee hearings, p . 524) is quoted, with addi-
tional comments, in the supplemental statement of the Rockefeller Foundation
(verified under oath by Mr. Rusk) filed with this committee on August 3, 1964,
as follows (pp. 10-11)
"The actual facts in regard to this episode, which differ materially from Dr .
Colegrove's version, were set forth in the public testimony of the president of
the Rockefeller Foundation before the Cox committee as follows
" Ìn 1944 Alfred Kohlberg sent the foundation copies of his charges of pro-
Communist bias in the IPR . The director of the social-sciences division of the
foundation suggested that the charges be referred to an independent body of
competent persons for hearing and determination . This proposal was accepted
by Mr . Kohlberg, but rejected by the IPR. Instead, a special committee of IPR
trustees reported to its board that the executive committee and responsible offi-
cers of the American council had "investigated Mr. Kohlberg's charges and
found them inaccurate and irresponsible ." The foundation officers would have
preferred an independent appraisal of the organization's activities, I might say,
not because of any views which they then held on the merits of the problem but
because in their view at the time that was the proper procedure by which you
could get rid of this kind of issue one way or the other .'
"The `director of the social-sciences division of the foundation' referred to in
this quotation was Joseph H . Willits, who is evidently the person Dr . Colegrove
had in mind . As the foregoing testimony shows, there was no plan to have the
foundation conduct a public investigation of the IPR, an undertaking for which
the foundation was neither equipped nor qualified . Mr . Willits never gave his
`consent' to have such an investigation undertaken by the foundation, and there
was no mysterious suppression of such a proposal . On the contrary, Mr . Willits
intervened with a suggestion for quite a different type of investigation which was
never carried out because the proposal was not acceptable to the IPR ."
In further amplification of Mr . Rusk's statements I submit the following
Toward the end of 1944 the foundation received a copy of Mr . Kohlberg's
charges against the Institute of Pacific Relations . This was followed by an
interview between Mr . Kohlberg and myself in the spring of 1945, in the course
of which he sought to enlist any interest or help we might appropriately give
toward resolving the situation .
Although I gave Mr . Kohlberg no encouragement at the time of our interview,
after further consideration, I felt that there would be no objection to an entirely
unofficial personal suggestion on my part that the parties agree to refer the
charges to an impartial committee of inquiry, of their own selection, for hearing
and determination . This would not involve any interference or inquiry by the
foundation, which would not even propose names for the committee of inquiry,
much less determine its membership, and which would leave it to the parties
themselves to agree upon the terms of reference and the procedure to be followed
by the committee . I offered to act in the role of mediator only, and even in that
role, I was a mediator, not of the issues in dispute, but of questions relating to a
possible procedure for settling those issues, a procedure in which the foundation
would not be a participant .
Accordingly, I sounded out both parties as to their attitude toward this pro-
posal. Mr. Kohlberg indicated his willingness to proceed, on condition that the
committee's inquiry should include both the Pacific and American Councils of
the IPR, and that the committee should be free to make its inquiry and search for
evidence as it wished .
The IPR was noncommittal, but I continued discussions with them on a basis
which I regarded as encouraging . On July 26, 1945, in an effort to bring the
matter to a head, I wrote a letter to Mr . Kohlberg, with copies to the repre-
sentatives of the American and Pacific Councils of the IPR, enclosing a state-
ment of certain points of agreement between the parties, as I understood them,
and stating that when both sides were in complete agreement as to charges,
terms of reference and methods of procedure I would send each a copy of the
final agreement, and a meeting to decide upon the membership of the committee
of inquiry should follow . This letter and the enclosure to which it refers read as
follows
[Letterhead of the Rockefeller Foundation]
JULY 26, 1945.
Mr. ALFRED KOHLBERO,
Shorehan Hotel, Spring Lake, N. J.
GENTLEMEN : I enclose a statement of my understanding of the points of sub-
stantial agreement reached in my separate conversations with you concerning a
committee of inquiry to examine into the charges of bias in the IPR .
If this statement does not correctly state your own views, please write or
telephone me the corrections you desire to have made and I shall continue my
efforts as your secretary . If you approve, please write me your approval .
When both sides are in complete agreement as to charges, terms of reference,
and methods of procedure I shall send each of you a copy of the final statement .
An exchange of letters direct or via me accepting the statement would seem then
to be in order. A meeting to decide upon the membership of the committee of
inquiry would follow .
In these mediation efforts I am not functioning as an official of the Rocke-
feller Foundation but solely as a citizen interested to see the dispute resolved .
I distinctly am not urging a committee of inquiry, but raised the question be-

cause each side had expressed sympathy for such a procedure . I am .ready and
glad to step out and drop the whole matter at any time, if you can find-some
more satisfactory alternative procedure or mediator .
Sincerely yours,
JOSEPH H . WILLITS.
Copy to Mr . Raymond Dennett ; copy to Professor Corbett, whom Mr. Edward
Carter has designated as representative of the Pacific Council .
Enclosure
POINTS OF AGREEMENT BETWEEN ALFRED KOHLBERG AND THE INSTITUTE OF
PACIFIC RELATIONS
(The following statement represents an attempt to set down the points of
agreement with respect to an impartial committee of inquiry to hear and examine
the charges made by Alfred Kohlberg against the Pacific and American Councils
of the Institute of Pacific Relations. This statement covers my tentative under-
standing of the points of agreement as to charges, terms of reference, and meth-
ods of procedure as reached in separate conversations with Alfred Kohlberg on
the one hand and with Raymond Dennett of the IPR on the other .-Joseph H .
Willits . )
CHARGES
Mr . Kohlberg charges an anti-Chungking, pro-Communist bias in the IPR's
attitude toward China as evidenced by-
(1) Distorted and inaccurate articles on China and the Chinese Government
appearing in publications of the Institute of Pacific Relations . Mr . Kohlberg
charges that this attitude has changed from time to time to correspond with atti-
tude reflected by articles appearing in Communist publications such as The New
Masses, The Communist, and The Daily Worker .
(2) Membership of staff writers on China of the Institute of Pacific Relations
(both American and Pacific Councils) at some time in the last 8 years in Com-
munist or Communist-front organizations or employment by them .
TERMS OF REFERENCE
The committee of inquiry is charged with responsibility for examining the
charges of bias in the publications of IPR and rendering an opinion thereon .
METHOD OF PROCEDURE
It is agreed by both parties that
(1) The membership of the committee of inquiry shall consist of three
persons, mutually agreed to by both parties .
(2) The inquiry shall embrace both the Pacific and American Councils.
(3) The committee of inquiry shall be free to determine its own procedure
and search for evidence as it sees fit ; and to decide also what testimony is
relevant.
(4) The hearings shall not be public .
(5) Each party to the dispute shall, within reasonable limits, be free to
bring such assistants and advisers to the hearings as he may wish . The
committee of inquiry shall determine what constitutes "reasonable limits ."
(6) Each party to the dispute binds himself (and his organization) to
keep the proceedings secret and specifically to give no report of the proceed-
ings to the press .
(7) A complete transcript of the proceeding shall be made and one copy
each furnished to Mr . Kohlberg and to the IPR. Other copy or copies shall
be the property of the committee of inquiry .
(8) Each party shall limit its presentation of testimony to 2 days' time .
(9) Mr . Kohlberg agrees to drop his court suit against the IPR and not
again to revive it in case the committee of inquiry comes into being and
reports.
(10) The expenses of the committee of inquiry shall be provided equally
by the two parties to the issue .
(11) A copy of the report of the committee of inquiry shall go to each
member of the American Council .
No decision was reached during August, probably because of the absence on
vacation of a number of those interested in the matter .


Under date of September 6, 1945, I received the following letter from the
secretary of the American Council, IPR
[Letterhead of American Council, Institute of Pacific Relations, Inc .]
SEPTEMBER 6,'1945 .
Mr. JOSEPH H . WILLITS,
Rockefeller Foundation, New York, N. Y.
DEAR MR. WILLITS : The executive committee of the American Council of the
IPR has considered your letter of July 26 in which you transmit a proposed
understanding between the IPR and Mr . Alfred Kohlberg for the constitution of
a committee of inquiry to examine into charges of bias in the IPR.
The committee has instructed me to inform you that it has decided not to
accept the proposals which have been made, and is instead forwarding to Mr .
Kohlberg, through his lawyers, an alternate proposal, to wit ; an offer to mail
all the members of the American Council whatever material he may wish to
send regardless of whether or not it may not contain libelous material .
The reasons for the rejection of this offer and the substitution of an alternate
proposal include a desire on the part of the executive committee of the Amrican
Council to conclude this matter as quickly as possible by offering Mr . Kohlberg
the opportunity to present his charges to the membership, collect his proxies, and
have the matter settled by the decision of the members of our own organization,
who, since they represent a cross section of the American public are presumably
in a position to judge intelligently on the matters at issue .
The committee was further impelled to this decision by noting that Mr.
Kohlberg had continued two additional general circularizations : one an openn
letter to Mr . Raymond Gram Swing, and another an open letter to the trustees
of this organization, under date of August 31 . Both of these communications
occurred during the time when we were both presumably engaged in considering
the proposals which you were kind enough to suggest .
The committee has also asked me to express to you its deep appreciation of
your courtesies and kind efforts to bring this matter to a conclusion . We feel
indebted to you for your personal interest and kindness in this matter and I am
sure that you will realize that our decision stems from a conviction that our
proposed method, if Mr . Kohlberg accepts it, will be in the best interests of our
organization .
With cordial best wishes,
Sincerely yours,
RAYMOND DENNETT, Secretary .
This letter left me no choice, as a mediator, but to drop the proposal which
for several months I had been trying to bring to fruition . Accordingly, I tele-
phoned Mr. Kohlberg reporting the IPR's decision to him . I received in reply
the following letter
[Letterhead of Alfred Kohlberg, Inc .]
SEPTEMBER 11, 1945 .
Mr . JOSEPH H. WILLITS,
New York 20, N. Y.
MY DEAR Mx. WILLITS : I desire to take this occasion to thank you for the time
and effort spent in attempting to arrange for an impartial hearing of the charges
I have preferred against the management of the Institute of Pacific Relations .
In our future relations with the nations of the Pacific Basin, the institute should
play an important part .
As I understood you over the telephone yesterday, the institute will take up
directly with me the question of a hearing on my charges and have asked you
to withdraw from a part in such arrangements. As I understand it, I will hear
from the institute in due course .
Your fairness, impartiality, and patience I hope will bring about a satisfactory
investigation, which will result in strengthening the institute as an organ of
international good will .
Very sincerely yours,
ALFRED KOHLBERO .

This exchange of correspondence was closed with my answer, as follows

SEPTEMBER 14, 1945 .
Mr. ALFRED KOHLBERG,
New York, N. Y .
MY DEAR MR . KOHLBERG : Thank you for your letter of September 11 . I am
glad if my efforts to bring about some adjustment of the differences between
yourself and the Institute of Pacific Relations have helped toward a mutually
satisfactory conclusion . As you appreciate, I was merely trying to be a mediating
middleman.
Perhaps I should correct one small point in your letter . The institute has
not asked me to withdraw. They have merely said that they were prepared to
make a direct proposal to you and in the meantime the question of a committee
to hold a hearing is withdrawn . I don't know just what their proposal is. That
they will make clear to you .
Sincerely yours,
JOSEPH H. WILLITS.
My statement that I did not "agree, on behalf of the Rockefeller Foundation,
to have his [Mr. Kohlberg's] charges investigated" is borne out by Mr. Kohlberg's
testimony before the Cox committee . After referring to the filing of his charges
and to his interview with me, Mr . Kohlberg testified
"A little bit later in the summer of 1945, Mr . Willetts (sic) proposed that the
institute and I get together and agree on a committee of three impartial persons
to hear my charges and evidence, and hear the institute's side, and make a report
to the institute and to the Rockefeller Foundation" (Cox committee hearings,
p. 652) .
Mr . Kohlberg's further testimony as to my report to him on the breakdown of
my negotiations with the IPR (Cox committee hearings, p . 654) is also generally
corroborative of what I have said above .
A special committee of IPR trustees later reported that the executive com-
mittee had investigated Mr . Kohlberg's charges "and found them inaccurate and
irresponsible."
The fact that no investigation of Mr . Kohlberg's charges was made by a com-
mittee of inquiry such as I proposed did not mean, however, that the matter was
dropped by the Rockefeller Foundation . As was fully explained in Mr . Rusk's
testimony before the Cox committee (Cox committee hearings, pp . 524-526) the
question of whether or not a further grant should be made to the IPR came before
the foundation in 1946 . As part of a very thorough inquiry into the whole IPR
situation by the foundation staff, we sought the advice of, among many others,
four former trustees of the American Council of the IPR who were understood
to have resigned from its board because of dissatisfaction with conditions in the
organization . After referring to the concern which these former trustees ex-
pressed in regard to certain aspects of the IPR's personnel and organization,
Mr . Rusk correctly summed up their position in his testimony as follows
"But the overall feeling among this group of former trustees was that the
Kohlberg charges had been exaggerated, and that the most important service the
Rockefeller Foundation could render was not to destroy the American Council
by abruptly ending its support but, rather, to renew its grants and thereby
reinforce the efforts of the group who were working to strengthen the organiza-
tion in line with its original objectives ."
The foundation's 1946 grants to the IPR were made only after a careful
investigation by us and after obtaining the advice of such men as these who
were in a position to understand conditions within the IPR . It is interesting
also to note that the committee's witness, Dr . David N. Rowe, who had joined
the IPR around 1939, became a member of its board of trustees in 1947, the year
after these grants were made, and continued to serve as a member of its board
until 1950 . His testimony in support of the reputation which the IPR still
enjoyed "up until the late forties" has been quoted in the Rockefeller Founda-
tion's Supplemental Statement, dated August 3, 1954, at page 11 .
JOSEPH H. WILLITS .
STATE OF NEW YORK,
Sworn to before me this 9th day of August 1954 .
I SEALI HAROLD B . LEONARD,
REPORT ON INTERNATIONAL RELATIONS CLUBS WHICH ARE SPONSORED BY THE,
CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE
(By Felix Wittmer, Ph . D., formerly associate professor of the social studies„
New Jersey State Teachers College at'Montclair)
When I taught history and political science at the New Jersey State Teachers.
College at Montclair, I was faculty adviser of the International Relations Club
for a period of about 12 or 13 years, from about 1937 to 1950 . This club was
and is one of a network of many hundreds, if not close to a thousand college clubs,
known as International Relations Clubs, all of which are sponsored by the Car
negie Endowment for International Peace .
For most of the time when I served as faculty adviser, said club received a .
large amount of printed material from, the Carnegie Endowment free of charge .
At the beginning of each school year I had to notify the secretariat of the Car
negie Endowment regarding the number of free copies of the bulletins of the
Foreign Policy Association which we required for our study groups . We were
regularly supplied with various types of publications of the Foreign Policy
Association, including the pamphlets known as Headline Books . In an article,.
Pamphlets Spread Soviet Propaganda, which appeared in the November 1952,
issue of National Republic, I have analyzed the subversive character of these
pamphlets .
Mrs. Vera Micheles Dean figured for many years as research director of the
publications of the Foreign Policy Association . Mrs. Dean belonged among those
who in 1937 signed their names in the Golden Book of American-Soviet Friend-
ship, a memorial which appeared in the Communist-front magazine Soviet Russia
Today of November 1937 . According to the testimony of Walter S . Steele before
the House Un-American Activities Committee on July 21, 1947, Mrs. Dean's,
writings figured in the Communist propaganda kit for teachers of the National
Council of American-Soviet Friendship.
Mrs . Dean cooperated with the world's toughest Communist agents, such as .
Tsola N. Dragoicheva, of Bulgaria, and Madame Madeleine Braun, the French .
Communist deputy, in helping to set up the Congress of American Women, a
Communist front so important in its worldwide ramifications that the House
Un-American Activities Committee devoted a 114-page pamphlet to it . At one
of the preliminary meetings of this Communist front Vera Micheles Dean, ac- .
cording to the New York Times of October 14, 1946 (p . 26), told 150 foreign and
50 American delegates to "whittle away their conceptions of national sovereignty"'
and to pull themselves out of the "ancient grooves of nationalism ."
The Carnegie Endownment also supplied our International Relations Club
with a large segment of the publications of the Institute of Pacific Relations,,
whose subversive character has been documented at the hearings of the McCarran
committee. For a great many years the Carnegie Endowment twice a year, i . e .,
each semester, provided our club with about half a dozen books, free of charge . .
There was never any opportunity for the faculty adviser to suggest titles of con-
servative books which uphold the principle of competitive enterprise and individ-
ual responsibility, and which warn against close association with state-controlled
nations . The Carnegie Endowment stipulated that these gift books be kept in a
separate department in the college library . In the course of years our club
built up a substantial IRS library comprising several shelves .
Among the books received from the Carnegie Endowment for International_
Peace there were publications of the American Russian Institute, such as The
Soviet Union Today . The American Russian Institute has been cited as Com-
munist by Attorney General Tom Clark . To the best of my knowledge the authors
of these gift books included such stalwarts of the Communist causes as Ruth ,
Benedict, T . A . Bisson, Evans Clark, Corliss Lamont, Owen Lattimore, Nathaniel
Peffer, and Alexander Worth .
At the hearings on the Institute of Pacific Relations, which were held by the-
Internal Security Subcommittee of the Senate Committee on the Judiciary, from
July 25, 1951, to June 20, 1952, T . A. Bisson, Corliss Lamont, and Owen Latti
more were identified under oath as Communists .
The late Ruth Benedict, along with Gene Weltfish, was coauthor of Races Of
Mankind, a public affairs pamphlet which was barred by the War Department
following upon congressional protest . Dr . Weltfish resigned from Columbia
University after she had refused to tell a congressional committee whether she .
was or ever had been a member of the Communist Party . Dr . Benedict has been
a sponsor of American Committee for Democracy and Intellectual Freedom
49720-54-pt . 2-18
American Committee for Protection of Foreign Born ; American Committee To

Save Refugees ; American ;Friends of the Chinese :People ; and the League of
American Writers, all of which have been listed in the Guide to Subversive
Organizations and Publications, which was released by the House Un-American
Activities Committee on May 14, 1951 . According to the Communist Party
publication Daily Worker of January 6, 1944, page 3, Dr . Benedict was a lecturer
at the Jefferson School of Social Science, which Attorney General Tom Clark
has cited as an "adjunct of the Communist Party ."
Evans Clark, quondam director of the Twentieth Century Fund, which has sup-
ported radical, leftwing publications, along with such oldtimers of the Commu-
nist fronts as Louis Adamic, Erskine Caldwell, Henry Pratt Fairchild, Langston
Hughes, Rockwell Kent, George Marshall, Maxwell S . Stewart, and Max Yergan,
sponsored the Council for Pan-American Democracy, which has been cited as
subversive and Communist by Attorney General Clark . He was also involved
in the sponsorship of American Investors Union, Inc . ; Committee for a Boycott
Against Japanese Aggression ; and Consumers' National Federation, all of which
are listed in the official Guide to Subversive Organizations and Publications of
the House Un-American Activities Committee (82d Cong ., 1st sess.) . Mr . Clark
also was at one time secretary to Ludwig C . K. A . Martens, the first Communist
ever to be deported from our shores .
Prof. Nathaniel Peffer, of Columbia University, whose Basis for Peace in the
Far East was included in the free shipments of the Carnegie Endowment, has
been exposed by Ralph De Toledano, in the Gravediggers of America, part I
(American Mercury, July 1951), as one of a cabal of 16 authors and book
reviewers who through the media of the New York Times Book Review, the New
York Herald Tribune Book Section, and the Saturday Review of Literature
systematically praised pro-Communist books and discredited anti-Communist
publications. In the New York Times Book Review Peffer called George Creel's
valuable Russia's Race for Asia a foolish book . In this review he reprimanded
Creel bcause "he fears Russia and does not like or trust the Chinese Communists ."
The Challenge of Red China, by Guenther Stein (whom a SCAP intelligence
report named as a Soviet agent) was praised by Lattimore in the New York
Herald Tribune Book Section and by Peffer in the New York Times Book Review
In this eulogy of an all-out apologia of communism in the Far East, Columbia
University's Nathaniel Peffer said that the leaders of the Chinese Communists
"are exceptionally straightforward, simple, of unquestionable integrity ."
Alexander Werth is the well-known European apologist for various Commu-
nist causes . His book, Leningrad, was sent as a gift to college clubs by the
Carnegie Endowment for International Peace.
Many other books which the Carnegie Endowment sent to our college clubs as
gifts, while not quite so outspokenly pro-Communist, were of the leftwing variety.
Among these I would include Sir Bernard Pares, Russia and Russia and the
Peace ; Sumner Welles, the World of the Four Freedoms ; and Henry Morgenthau,
Jr., Germany Is Our Problem . I do not recall that the book gift packages of 10
to 12 publications per year ever included a single conservative or anti-Communist
work.
When, in an effort to counteract the pro-Communist influence of the Carnegie
Endowment I ordered some anti-Communist books for our library (including
works by David J. Dallin and Freda Utley), students asked me : "Are you sure
that these are trustworthy publications? If they are reliable, why is it that the
Carnegie Endowment for International Peace has not included them in its gift
packages?" (This, at least, was the meaning of the students' questions .)
While faculty advisers of the International Relations Clubs corresponded with
a woman secretary of the endowment, it was understood that Dr . Howard Wilson,
well-known leftwing internationalist and one of the top officials of the Carnegie
Endowment for International Peace, was in charge of the nationwide IRC
project . Dr . Wilson was a frequent speaker at radical conferences and institutes .
Thus he participated in a conference of the education committee of the National
Council of American-Soviet Friendship, in New York City, along with such
veteran Communist fronters as Frank E . Baker, Robert S . Lynd, and Arthur
Upham Pope. Another of these education conferences of the National Council
of American-Soviet Friendship, which was held at Boston, included such well-
known sponsors of the Communist cause as Herbert Davis, Corliss Lamont,
Prof . Dirk Struik (who has in the meantime been dismissed from Massachusetts
Institute of Technology because of his membership in the Communist Party) and
.the Carnegie Endowment's Dr. Howard Wilson.


The annual regional conference of International Relations Clubs was the most
widely heralded' feature of this Carnegie Endowment project . The club of the
New Jersey State Teachers College at Montclair belonged to the regional group
of the northeastern seaboard and Canada, which to the best of my recollection
included from 125 to 150 college clubs. There must have been at least 7 or 8
similar regional conferences, in other parts of the United States .
According to the detailed reports of the student-delegates of Montclair State
Teachers College, a large majority of those students who attended such confer-
ences favored the views which came close to that of the Kremlin . Students
from Catholic colleges, though in the minority, were known to challenge the
pro-Soviet delegates .
For many a year I made it a point to supply speaker-delegates of our college
with reading material which would counterbalance the radical tendencies of
publications with which the Carnegie Endowment had provided us . As a result
of such tutoring the student-delegates from Montclair Teachers College regularly
clashed with the majority .
Either in 1947 or in 1948, the regional conference of the northeastern section
of IRC's was held on the campus of the New Jersey State Teachers College at
Montclair. Our college was not the choice by vote, but substituted for another
college whose facilities had become unavailable . The best our program com-
mittee could do with regard to speakers was to select known anti-Communists
who were far enough to the left not to cause bedlam among the about 300 dele-
gates who attended the 3-day conference . Dr . Harry D . Gideonse, the liberal,
anti-Communist president of Brooklyn College and Prof . George S . Counts, of
Columbia Teachers College, the one-time pro-Communist who had become anti-
Communist, were chosen by the program committee of our college club .
It is worth mentioning that Mr . Alger Hiss, who then was president of the
Carnegie Endowment for International Peace, was forced upon our club not
merely as a speaker, but as the speaker of the final meeting . Having observed
the activities of Mr . Hiss in the State Department for several years, including
his role at the Bretton Woods Conference and the San Francisco Conference
(at which the United Nations was founded), I vigorously protested to the
secretary of the Carnegie Endowment against the appearance of Mr . Hiss .
I was reminded in no uncertain terms that our club, like all the other hun-
dreds of clubs, was under the direction of the Carnegie Endowment for Interna-
tional peace, which had for years liberally supplied it with reading material,
and which contributed funds to cover the honoraria of conference speakers .
My repeated protestations were overruled by the secretary of the endowment .
It turned out that a large group of enthusiastic ladies, most of whom were
members of the local chapter of the United Nations Association, flocked to our
campus to hear and see in person the principal American architect of the United
Nations . This United Nations group has held State-accredited summer insti-
tutes on the United Nations at the New Jersey State Teachers College at Mont-
clair, for the past few years .
I might conclude in adding the personal note that soon after the IRC confer-
ence on our campus had taken place a group of radical leftwing students made
successful efforts to infiltrate our International Relations Club by electing some
officers who were hostile to my anti-Socialist-Communist views . As a result
of systematic radical agitation in the club I resigned as its adviser . My suc-
cessor was one Dr . Frank L . Clayton who had been granted a leave of absence
to work at Columbia Teachers College as a member of the staff which developed
the citizenship education project . The subversive and collectivist tendencies of
said project were exposed by Frank Hughes in the Chicago Tribune of August
12-16, 1951 . The project, according to the New York Times of April 20, 1953,
page 27, during the first 4 years of its existence received $1,367,000 from the
Carnegie Corp. of New York .
STATE OF NEw JERSEY,
County of Essex, ss :
I, Felix Wittmer, swear and affirm that I have read and am familiar with the
contents of the foregoing report ; and that to the best of my knowledge and
belief, every statement of fact contained therein is true .
FELIx WITTMER .
Subscribed and sworn to before me this - day of August 1954 .
HELEN S . MOUNTJOv,
Notary Public, State of New Jersey.
COLUMBIA UNIVERSITY,
IN THE CITY OF NEW YORK,
SCHOOL OF LAW,
New York, N . Y., September 1, 1954 .
Hon . CARROLL REECE,
Chairman, Special Committee To Investigate Taa Exempt Foundations,
House Office Building, Washington, D . C.
MY DEAR REPRESENTATIVE REECE : Under date of July 1, 1954, a report was
made to your committee by Kathryn Casey, legal analyst, purporting to sum-
marize some of the activities of the Rockefeller Foundation and others . I have
only recently seen that document for the first time . At pages 69-71 the legal
analyst's report contains references to me and my work that are erroneous-
In all fairness to me they should not stand without correction . I therefore
respectfully request that my attached statement should be made a part of your
committee's records, and that it be included in your printed proceedings if the
above references are similarly included . In this way the committee can undo ,
some of the injury that has been done me under its authority .
You will observe that I have made my statement under oath .
So that they too may be informed of the facts, I am sending copies of this
letter and the attached statement to your colleagues on the special committee,,
as well as to the committee's general counsel and research director .
Very truly yours,
WALTER GELLHORN,
Professor of Law .
STATEMENT OF WALTER, GELLHORN BEFORE THE SPECIAL COMMITTEE To INVESTIGATE*
TAX EXEMPT FOUNDATIONS, HOUSE OF REPRESENTATIVES, 83D CONGRESS
The following statement is made for the consideration of the Special Com-
mittee To Investigate Tax Exempt Foundations of the 83d Congress . I am
moved to make it because erroneous information concerning me has been given
to the committee, appearing at pages 69-71 of the (mimeographed) report by
Kathryn Casey, legal analyst, under date of July 1, 1954 . At no time was an.
effort made on the committee's behalf to verify the report's contents by inter-
viewing or interrogating me. I should like to stress that the statement I am.
now presenting to the committee is made upon my own initiative and, moreover, .
is made under solemn oath .
My name is Walter Gellhorn . I am now and for 21 years have been a pro-
fessor in the Law School of Columbia University. I am a member of the bar
of New York. I reside at 186 East Palisade Avenue, Englewood, N . J .
1 . The central question toward which the legal analyst's attention was ap-
parently addressed was whether I am an objective scholar and thus qualified
to participate in an analysis of governmental security and loyalty programs, as
part of the Cornell studies in civil liberty supported by the Rockefeller Founda- ,
tion . As bearing on this question the legal analyst sets forth 5 brief para-
graphs purporting to characterize or synopsize the extensive materials set forth.
in my 300-page book, Security, Loyalty, and Science . Inevitably this involves
quotation out of context, incompleteness, and distortion .
A fairer impression of my volume may be derived from its evaluation by the
many reviewers who appraised it in professional as well as popular publica-
tions . From the large number at hand, I shall quote only from a few by com-
mentators who are, I am sure, well known to and much respected by this,
committee.
President James R . Killian, Jr., Massachusetts Institute of Technology (in Yale-
Review) : "This is by all odds the best-informed, the most objective, and the •
most thorough study yet to appear of the effects of military secrecy and loyalty
tests on scientific progress in America . * * *"
Professor Jay Murphy, University of Alabama (in Vanderbilt Law Review) s
"In the most objective manner conceivable and with real scholarship, Professor
Gellhorn has examined the laws and policies of the Federal Government * * s
Professor Gellhorn has written this book in a manner which other scholars may
emulate . He has conducted exhaustive, often firsthand, studies of the places,
persons, and methods involved . There is restraint in his orderly analysis . He
has not destroyed without creating. The book is a real contribution * * *"
President L . A . Du Bridge, California Institute of Technology (in Standford
Law Review) : "This is a desperately needed and most valuable book . In it
the thoughtful American will find a cool and unbiased appraisal of the
issues * * * The more it [the book] can be read and-,understood by laymen-
lawyers newspaper editors, Congressmen, and the public at large-the greater
will be our hope that we can achieve military security without unnecessary
sacrifice of the democratic principles which our military power is intended to
preserve."
Rear Adm . Roger W. Paine, United States Navy (retired) (in Naval Institute
Proceedings) : "Any officer of the Defense Department presently or likely to be
assigned to duty where he must participate in the administration of the laws and
executive orders devised to safeguard military secrecy or national security, should
have this book in his background . * * * The author * * * is satisfactorily objec-
tive in his approach to this highly controversial problem ."
Professor W. Mansfield Cooper, University of Manchester, England (in The
Political Quarterly) : "The present writer, whose interest derives not from any
knowledge of science but from having met some of these problems in university
administration, has found it [the book] fascinating and has laid it down with
an increased faith in the American people . And it is a measure of Professor
Gellhorn's achievement that, criticizing certain practices in his own country, he
yet induces in a foreigner a greater respect for it ."
I shall not burden this statement with further excerpts from the reviews, but
I should add that in 1952 the first presentation of the Goldsmith memorial award
was made to Security, Loyalty, and Science ; the award is made annually "for
the best article, book, or public pronouncement which contributes to the clarifi-
cation of the right relations between science and politics."
These reactions to my work by recognized authorities should adequately refute
any insinuation that I am not a qualified and objective scholar. It is unneces-
sary, however, to rest upon one book alone . My writings extend over a period
of 25 years : One of my books is more widely used than any other in the teaching
of administrative law in American law schools . In 1946 Harvard University
awarded me its Henderson memorial prize for work done in that field . Within
the years immediately past I have been invited to lecture at leading universities
not only in this country, but in Great Britain, Japan, New Zealand, and Western
Germany . In 1952 Amherst College conferred on me the degree of doctor of
humane letters, the citation that accompanied this honor referring among other
things to the "wide recognition" accorded my "judicious examination of the
problem of whether and how liberty and security may be combined in the field
of scientific research ." In 1953, I was unanimously elected a member of the
executive committee of the Association of American Law Schools . I have directed
the research of the New York Law Society . The section of judicial administra-
tion of the Amercan Bar Association, under the chairmanship of Judge Harold
R. Medina, requested my direction of a study of the functioning of courts in the
New York metropolitan area .
These are not the sorts of distinctions that come to a scholar whose work is
infected by bias.
Moreover, in the community where most of my professional life has been lived
and where there has therefore been the most sustained knowledge of all my
activities, the derogatory appraisal suggested by your legal analyst is directly
repudiated . Two years ago the Association of the Bar of the City of New York,
widely regarded as the leading legal association of the Nation, requested me to
conduct in its behalf an extensive study of the administration of laws affecting
families and children . The results of that study have been supported and
endorsed by the bar association, and have been praised in the editorial columns
of the newspapers . They have recently been published by Dodd, Mead & Co., in
a volume entitled "Children and Families in the Courts of New York City ."
This record of scholarly integrity should not be impugned by uninformed
comment .
2 . The Legal Analyst asserts (mimeographed p. 70) that in the Harvard Law
Review of October 1947 I published an article "specifically defending the Southern
Conference for Human Welfare, exposed as a Communist organization, and vio-
lently attacking the House committee ."
The actual facts demonstrate beyond question the inaccuracy of the allega-
tions.
0001
At the very outset of the Harvard article to which reference is made (Report
on a Report of the House Committee On Un-American Activities, 60 Harvard
Law Review 1193), I stated that the author does not "propose to serve in the
role of defense counsel, as it were, for the southern conference . He is not con-
nected with the conference, has no authorization to speak for it, and has access
to no special body of knowledge about its activities ." And again, at the end of
the article, I repeated that I "disclaimed any intent to appraise the Southern
Conference for Human Welfare ." These unequivocal and unmodified statements
adequately show that I was not "specifically defending" the southern conference .
As for the alleged "violent attack" upon the House committee, I did no more
than examine its own report in order to analyze the techniques used in that
particular instance . I found-and demonstrated by precise citation of chapter
and verse-that those techniques had in that case included partial and mislead-
ing quotations out of context, the repetition of unverified charges that would
have been dispelled by even a cursory inquiry, the loose and damaging charac-
terization of persons of good standing, the ignoring of relevant information that,
if recorded, would have affected the opinion of fairminded men, and insensitivity
to a cherished American value, the preservation of an individual's reputation
against unfair attack . I did indeed severely criticize those techniques . They
deserve condemnation when used by or in behalf of any committee of the
Congress.
3 . The Legal Analyst says (mimeographed p . 70) that I am cited as an "active
leader" of the National Lawyers Guild .
The simple fact is that I have not even been a member of the National Lawyers
Guild for a number of years, and that during the period of my membership I
was not prominent enough in its affairs to be deemed an "active leader ." I
doubt that activity in the guild could properly be regarded as reprehensible, in
and of itself, without reference to what the activity was ; but in any event I
was, on the whole, an inactive rather than an active member, and am no longer a
member of any sort.
4. The Legal Analyst reports (mimeographed p . 69) that I am "listed in ap-
pendix IX, page 471, as a `conscious propagandist and fellow traveler .'"
A word needs to be said about the appendix IX upon which this statement so
directly leans .
The Legislative Reference Service of the Library of Congress informs me that
appendix IX, with its cumulative index, was prepared late in 1944 by a subcom-
mittee of the old Dies committee, and fills seven volumes containing 2,166 pages .
A large number of copies of the report were printed . But, continues the letter
to me from the Director of the Legislative Reference Service, "When the report
was brought to the attention of the full committee it was ordered restricted and
the existing copies were destroyed. A number of copies were distributed by the
Government Printing Office to subscribers before the distribution was cancelled
by the committee."
The conclusion seems inescapable that appendix IX was found unacceptable
by the very committee to which it was presented-and very possibly for the
precise reason that it contained just such unsubstantiated comments as the one
referred to by your staff member .
Here again the facts are quite clear . The characterization of me by some un-
identified person in appendix IX is in connection with a little known travel
organization, Open Road, Inc ., of which I was a director in 1929-31 . My sworn
testimony concerning this organization was freely given before this special
committee's predecessor, the Cox committee, and appears at pages 738-739 of
the hearings conducted by that committee in 1952 pursuant to H . Res . 561 . Suf-
fice it now to say that I was 23 and 24 years old at the time of my association
with the Open Road ; that I was then a student in law school ; and that I re-
signed from it when in 19311 left New York to become law secretary to Supreme
Court Justice Harlan Fiske Stone and, later during the Hoover administration,
an attorney in the Office of the Solicitor General under Judge Thomas D .
Thacher .
The Open Road, as my earlier recorded testimony shows, was a purely educa-
tional and nonpolitical organization devoted to facilitating travel abroad. Its
chief sponsors were distinguished college presidents such as Farrand of Cornell,
Garfield of Williams, and MacCracken of Vassar . It became defunct, some years
after I had terminated my relationship with it, because wartime conditions
from 1939 onward made travel impossible . As I observed before the Cox com-
mittee, "All I can say about the organization is that certainly during the years
of my association with it, it had no political orientation or motivation what-

TAX-EXEMPT FOUNDATIONS 122:1

soever . * * *' The worst that can be said about the young people who were
interested in that organization, as I was at that time, is that they entertained
the perhaps naive belief that the world would be a friendlier place if its inhabi-
tants became a little better acquainted ."
This is the setting of the charge that, at the age of 23 and while busily en-
gaged in professional studies, I was a "conscious propagandist" and "fellow-
traveler" in the Open Road, Inc ., immediately before becoming the confidential
assistant of a Supreme Court Justice .
5 . The Legal Analyst remarks (mimeographed p . 70) that on March 15, 1948,
the Daily Worker quoted from an article by me concerning the House Committee
on Un-American Activities .
The plain fact is that I wrote an article entitled "In Defense of American
Activities" upon the invitation of the American Scholar, in which it appeared
in the spring of 1948 . The American Scholar is a quarterly journal published
by Phi Beta Kappa . Subsequent references to the article, whether by the Daily
Worker or by others, are not within the author's control . Since the entire
article is available in the pages of one of the most respected of all American
magazines, I suggest that it be read in full . It cannot be characterized, as the
staff report attempted to do, by lifting two noncontextual quotations from a
notably unreliable secondary source.
6 . The Legal Analyst correctly states (mimeographed p . 69) that I was at one
time a national committeeman of the International Juridical Association, but
wrongly implies that an impropriety lurks in that fact .
This association went out of existence some 12 years ago . It was a nonprofit
organization . Throughout my connection with it of about 5 years, it was so
far as I know devoted exclusively to legal research with particular emphasis upon
labor law and civil liberties . Its primary function was the publication of a
monthly bulletin, which appeared in 11 volumes . The bulletin, as examination
of these volumes will show, was a legal periodical devoted to reporting, analyzing,
and discussing decisions of the courts and administrative bodies and the actions
of the executive and legislative branches of Government . It had widespread
recognition as a scholarly journal and as a source of otherwise unreported legal
material . Among its subscribers were the Library of the Supreme Court, the
Library of the Department of Justice, 28 State supreme court libraries, various
court and bar association libraries, and the libraries of every major university
in the United States . My interest in the IJA was an interest in its bulletin, re-
lated to my academic duties.
7. The Legal Analyst asserts (mimeographed p . 69) that I "was a leading mem-
ber of some 11 Communist fronts ."
This statement is unsupported by factual specifications . It is not true . Not
even a superficial inquiry was directed to me to ascertain its accuracy . I repel
the allegation with indignation and with a sense of outrage that, under your
committee's authority, a charge of this nature has been published .
8. The Legal Analyst describes me as "apparently actually the director of the
Cornell Studies in Civil Liberties (mimeographed p . 69) and as "coauthor of a
study on States and Subversion (with William B . Prendergast, assistant professor
of .government at the Naval Academy), and of a study on-the Tenney Committee
(with Edward Barrett, Jr ., professor of law, University of California * * *)"
(mimeographed p. 71) .
Obviously there is nothing derogatory to me in these particular remarks . I
set them forth here only because they reveal how easily error can creep into a
report untested by the scrutiny of one who knows the facts .
The director of the Cornell studies is and was at all times Prof. Robert E . Cush-
man of Cornell, one of America's most distinguished political scientists . The
studies were initiated under his direction before my association with the project,
and they have continued under his direction long after I had completed my
portion of them. I am proud to have been a part of the project, but at no time and
in no manner was I either "apparently" or "actually" its director . There is: not
the slightest basis for a contrary statement .
As for the States and Subversion, I was coauthor not merely with Professor
Prendergast, but with five others as well, and was in addition the editor of this
volume . As for the T'enney Committee, I was in no sense coauthor ; Professor
Barrett alone deserves the credit for that able volume . I emphasize these simple
facts not because they have importance in themselves, but because misstatements
in matters that are so readily subject to verification tend to emphasize the un-
reliability of other observations as well .

In closing this statement I desire to add only this : I have held responsible posts
in three national administrations ; my professional career has had its share of dis-
tinctions ; the university of whose faculty I have been a member for 21 years has
reposed a contdence in me that is not extended to one-whose probity .as a rna..n or
as a scholar is suspect. Half a dozen inaccurate paragraphs in a staff report
are a poor offset against the whole record of my adult life .
WALTER GELLHORN.
Dated September 1, 1954.
STATE OF NEW YORK,
Walter Gellhorn, being duly sworn, says that he is the individual who prepared
the foregoing statement and in-whose-behalf it is made ; and that the statement
is true to the best of his knowledge, information, and belief .
WALTER GELLHORN .
Subscribed and sworn to before me this 1st day of September 1954 .
CECELIA SCHLESINGER .
CORRESPONDENCE WITH DR . MORTINIER GRAVES, EXECUTIVE DIRECTOR,

AMERICAN COUNCIL OF LEARNED SOCIETIES
AUGUST 19, 1954.
Dr . MORTIMER GRAVES,
American Council of Learned Societies,
Washington, D . C.
DEAR DR. GRAVES : The committee had intended to ask certain questions of
you about the time of your scheduled appearance before it and since, in line
with the resolution of the committee, no further public hearings will be held,
it becomes necessary to raise those questions through correspondence and request
that your answers be furnished in affidavit form .
The particular information desired concerns the statements which have been
made to the committee and which for convenience in answering, I will list
seriatim below
1 . According to the biography appearing in the 1948-49 issue of Who's Who,
you stated that you were a member of the board of directors of the American
Russian Institute and chairman of the Washington Committee To Aid China .
Are you now or have you been connected with either the institute or the committee,
and, if so, during what period?
2 . In the Washington Post of May 11, 1942, page 9, your name appeared as
a sponsor of the Citizens Committee To Free Earl Browder. Were you a sponsor
of the committee?
3 . Were you a sponsor of the National Council, American-Soviet Friendship?
4 . Your name is listed as one of the signers of an open letter, referred to in
the September 1939 issue of Soviet Russia Today, which urged closer cooperation
with the Soviet Union . Is that a fact?
5 . We are informed that in February 1941, you presided at a meeting of
the Washington Committee To Aid China, at which the two principal speakers
were Owen Lattimore and Frederick Vanderbilt Field . Is that a fact?
6 . We are informed that following the arrest of John Stewart Service in June
1945, you were treasurer of a voluntary committee soliciting funds for his
defense . Is this a fact?
7 . We are informed that you have now or have had in your employ, or the
employ of the American Council of Learned Societies, a man named Emanuel
Larson . Is this a fact? Did Mr . Larson receive a fellowship from the American
Council of Learned Societies?
8. Did Andrew Ross receive a fellowship from the -American Council of
Learned Societies? Are you acquainted with Mr. Ross?
9. The committee is informed that you at one time maintained files on numerous
students of the Far East and on persons given grants and engaged in research
as Far Eastern specialists . Is this a fact? Are these files still available and,
if not, what disposition was made of them? If they are intact, the committee
desires to see them .
10. Did you at any time keep a roster of the scientific and specialized personnel
for the use of various Government agencies or for any other use?


11 . The Reporter for April 29, 1952, contains the following statement at
page 22
"The personnel selected for Government agencies in the Far East was
picked from a roster of Èxperts' made up by the Council of Learned Societies
under the direction of Mortimer Graves ."
Is this an accurate statement? If so, please attach a list of the persons named
by you in this list.
12. Are you acquainted with any of the following individuals?
William Walter Remington
George Shaw Wheeler
Maurice Halperin
Luke I. Wilson
Mary Jane Keeney
Owen Lattimore
Robert Selberstein
Antoli Gromov
Harriet Moore (Gelfan)
Joseph Fels Barnes
Kathleen Barnes.
13 . You are shown as a vice chairman and trustee of the Institute of Pacific
Relations in Who's Who from 1942 to 1848 . Please name the persons, directly
or indirectly, concerned with the institute with whom you had contact with
regard to the activities of the institute, or with regard to Far Eastern matters .
14 . Was your connection with the institute terminated by resignation or by
expiration of a specific term of office? If the resignation was at the suggestion
of some other party, please identify fully . If the resignation was your own
decision, please give the reasons therefor .
As I stated in the opening paragraph of this letter, your answers should be
either in affidavit form or should have the same attestation clause which was
requested in connection with the statement you filed with the committee earlier .
I shall appreciate it if you will submit an original and five copies of this
affidavit .
Sincerely yours,
RENE A. WORMSER, General Counsel.
AMERICAN COUNCIL OF LEARNED SOCIETIES,

Washington 6, D . C., November 1, 1954.
Mr. RENT: A . WORMSER,
General Counsel, Select Committee To Investigate Tax Exempt Foundations,
House of Representatives,
Washington, D. C.
DEAR MR. WORMSER : I am enclosing the master of the replies to the questions
which you have asked of me ; the copies which you requested will be sent you as
soon as they come from the machines The lists of persons requested, and men-
tioned on page 10 of my replies, will reach you at the same time .
I regret what may seem to you a delay in submitting these materials, but the
exigencies of a full-time job and the fact that I could not recall the details of
these minor episodes of years ago in an active life made impossible an earlier
reply which might be useful .
Sincerely yours,
MORTIMER GRAVES,
Executive Director.
REPLIES BY MORTIMER GRAVES To QUESTIONS IN THE LETTER OF RENE A . WORMSER
OF AUGUST 23, 1954
1 . According to the biography appearing in the 1948-49 issue of Who's Who, you
stated that you were a member of the board of directors of the American
Russian Institute and chairman of the Washington Committee To Aid
China . Are you now or have you been connected with either the institute
or the committee and, if so, during what period?
1 . (a) The American Russian Institute of New York was founded in the early
1930's and continued until 1950 . I was a member of the board of directors of the
institute from about 1938 until its dissolution, during which time the principal
purpose of the institute was the establishment and maintenance of a library
1224 TAX-EXEMPT, FOUNDATIONS'
of contemporary Russian materials in various scholarly fields for the use of

American students of Soviet affairs .
During the time I was a director of the institute I did not attend directors'
meetings,' since they were held in New York, while I was kept by my work in
Washington for the most part . I was notified of forthcoming meetings and of
the subjects to be discussed at them . Whenever items on the agenda were of
special professional interest to me, in that they concerned the humanities, I
transmitted my views in writing to the board .
Sometime after the issuance of the President's loyalty order in 1947, it was
rumored that the institute was listed on the Attorney General's list of "sub-
versive" organizations, and after discussion among the directors, the then chair-
man of the board, Mr. Ernest Ropes, formerly of the Russian Division of the
Department of Commerce, consulted Attorney General Tom Clark about the
matter. Thereafter, Mr . Ropes informed the directors that he had received a
written assurance from the Attorney General that the institute was not listed .
I am under the impression that this entire episode arose because of confusion
between the American Russian Institute of New York with which I was asso-
ciated, and the American Russian Institute of San . Francisco which was in no
way connected with the New York organization .
In the late 1940's Columbia University established a Russian Institute which
began to collect published materials about Soviet Russia . In my opinion this
accomplished the main task of the American Russian Institute much more effec-
tively than that organization could do . As a consequence of this my interest in
the American Russian Institute declined and I requested several times that I not
be reelected to the board . My requests were ignored and I continued to be re-
elected in absentia until the dissolution of the organization .
(b) The Washington Committee for Aid to China was a local group in the
District of Columbia which protested and carried on agitation against the ship-
ment of oil, scrap iron, and other strategic materials to Japan as a part of an
attempt to influence the Government of the United States, in the years prior
to World War II, in support of Chiang Kai-shek and the Government of China
and against the Japanese Government which was at war with Chiang . The
wisdom of the course supported by the committee was fully confirmed by later
events .
The committee was founded in 1938 . I became associated with it in early 1939
and was its chairman from late in that year until the committee dissolved about
the time of the outbreak of World War II . The declaration of war eliminated
the need for the committee and, so far as I know, it has had no subsequent exist-
ence . At any rate, I have had no subsequent connection with it .
The operations of this committee were carried on through meetings, some large
and some small, which were addressed by persons with special experience or
knowledge of Far Eastern affairs and who were generally sympathetic to the
committee program outlined above . Among those who addressed meetings of
the committee were Congressman Judd, then recently returned from service as
a medical missionary in China, former Ambassador William Dodd, Paul Yu Pin,
the Roman Catholic Bishop of China, Mr . Owen Lattimore, Mr . Frederick V.
Field, Mr. Evans Carlson, and others . I have no present recollection of any of
the dates of the meetings at which these individuals spoke.
2 . In the Washington Post of May 11, 1942, page 9, your name appeared as a
sponsor of the Citizens Committee To Free Earl Browder . Were you a
sponsor of the committee?
2 . On or about May 11, 1942, I was requested to and did sign an appeal to
the President of the United States to grant clemency to Earl Browder, who was
then serving a 4-year prison sentence which I and others thought was excessive
for a minor violation of the passport laws . Beyond signing the appeal with
knowledge, that it was to be used as the basis of a newspaper advertisement, I
had no connection by way of sponsorship or membership with any such committee .
3 . Were you a sponsor of the National Council, American-Soviet Friendship?
3 . I cannot now recollect whether or not I was ever a sponsor of the National
Council for American-Soviet Friendship. As I recall, this council was organized
in the early 1930's, shortly after our Government recognized the Soviet Union,
with the purpose of making a sincere effort to see whether normal cultural rela-
tions were possible with that country . At that time, I was sympathetic with that
goal, which was indeed the declared policy of the United States Government .
4 . Your name is listed as one of the signers of an open letter, referred to in the
September 1939 issue of Soviet Russia Today, which urged closer coopera-
tion with the Soviet Union . Is that a fact?
4. Toward the end of the summer of 1939, I signed a letter urging closer
cooperation between the Western democracies and the Soviet Union as a means of
combating the menace of Hitler and Japan . Although most of the public atten-
tion given to this letter has been in connection with the reference to it in the
September 1939 issue of Soviet Russia Today, the letter was signed by me well
before the announcement of the Hitler-Stalin pact of August 21, 1939, and,
according to testimony given before the Senate Internal Security Subcommittee
in 1952, the letter in question was first released to the public on August 14, 1939 .
5 . We are informed that in February 1941, you presided at a meeting of the Wash-
ington Committee To Aid China, at which the two principal speakers were
Owen Lattimore and Frederick Vanderbilt Field . Is that a fact?
5. See paragraph 1 (b) .
6. We are informed that following the arrest of John Stewart Service in June
1945, you were treasurer of a voluntary committee soliciting funds for his
defense . Is this a fact?
6. In June 1945, Mr . Service and five other individuals were publicly accused
of unauthorized use of classified material in connection with the magazine Amer-
asia . On the day that this news was released I happened to be at lunch with
a group of people interested in China who knew Mr . Service more or less well .
All of us believed him to be innocent of any unlawful activity, a belief sup-
ported by his ultimate complete clearance . In the course of our luncheon
conversation, it was suggested that Mr . Service would need funds for the con-
duct of his defense. In the informal discussion that followed, each of the people
at luncheon agreed to contribute $50 and to speak to others in an effort to accu-
mulate a fund of perhaps $1,000 to be turned over to Mr . Service for this Pur-
pose . For some reason it was suggested that the money should be forwarded to
Mr . Service through me . The luncheon, so far as I know, was not called or
arranged with this purpose in mind .
Thereafter several checks were mailed to me . I made a contribution of $50
from my own pocket but did not solicit any one else . When the sum amounted
to $500, I turned it over to Mr . Service. Later an additional sum came in of
perhaps $200 or $250 which I offered to Mr . Service but which he refused to ac-
cept . The money was returned to the donors .
7. We are informed that you have now or have had in your employ, or the employ
of the American Council of Learned Societies, a man named Emanuel
Larson . Is this a fact? Did Mr . Larson receive a fellowship from the
American Council of Learned Societies?
7 . Mr . Emanuel Larsen was 1 of 22 individuals to whom the American Council
of Learned Societies granted study aids to attend a summer session on far
eastern studies inaugurated by Columbia University from June 8 to August 16,
1935 . The total amount divided among the 22 students was $1,200 . From
September 1 to November 30, 1935, Mr . Larson worked at the Library of Congress
in the center for Far Eastern studies . His activities were in connection with a
project carried out by the Library of Congress, but sponsored in its early stages
by the council . The project was the preparation of a biographical dictionary of
the eminent Chinese of the Ching Dynasty which was subsequently published
by the Library of Congress and printed by the Government Printing Office . As a
hart of its sponsorship of this project . the council made grants to a number of
those working on it, among them Mr . Larsen, who received a stipend of $400 from
the council on this account .
From June through October 1945, Mr . Larsen worked temporarily on an hourly
basis in the office of the council for its committee on far eastern studies . He
was paid at the rate of $1 per hour and his total remuneration for this period,
according to the council's records, came to $650 .
At no other time has Mr . Larson been employed by the council or has he received
any council funds by way of fellowship or other grant in aid .
8. Did Andrew Ross receive a fellowship from the American Council of Learned
Societies? Are you acquainted with Mr . Ross?
S . Mr. Andrew Ross never received any grant from the council, nor am I able
to place him in any way .
It occurred to me that the object of the committee's interest might be Mr .
Andrew Roth and I caused the council's files to be searched in regard to him .
1226 TAX-EXEMPT' FOUNDATIONS
I find that the council never awarded any grant to Mr . Andrew Roth . Our
records show that in 1940-41 he made application for a $200 grant which was
rejected .
9 . The committee is informed that you at one time maintained files on numerous
students of the Far East on persons given grants and engaged in research
as Far Eastern specialists .
(a) Is this true?
(b) Are these files still in existence?
(c) If not, what disposition was made of them, at what time?
(d) If they are still in existence the committee desires to see them .
9 . The statement submitted to your committee by the council on July 21, 1954,
under the heading "The Problem of Highly Trained and Specialized Personnel"
(p. 10 of the mimeographed statement) describes the nature and character of the
information on Far Eastern specialists which in the past was contained in the
council files . For the period from about 1935 to the middle of the war these
were by far the best files in existence on the professional qualifications of persons
in academic life with special competence on Far Eastern subjects . Of course,
since the council's interest is mainly in academic fields, these files were deficient
with regard to persons outside the academic sphere-businessmen, missionaries,
diplomats
. During theand the like-with Far Eastern training and experience .
war a national roster of scientific and specialized personnel was
developed by the Federal Government . In addition the Ethnogeographic Board,
located in the Smithsonian Institution and financed by the Rockefeller Founda-
tion, prepared a list of area specialists for use of various Government depart-
ments. Much of the material which had been in the council files was included
in these compilations which supplied the need for complete and centralized in-
formation about such personnel more effectively than the more or less haphazard
activity of the council . As a result the council files gradually distintegrated and
got out of date during the wartime period . After the war, the council made some
effort to rejuvenate them, but it was generally unsuccessful . A remnant of
these files still remains in the council's office . They have always been open to
any organization, including Government agencies, looking for people with special
competence in the area covered by the files . Consequently the committee Is
free to examine what is left of them at any time .
Information with respect to the council's activities in this field since 1949
is contained in paragraph 10 below .
10 . (a) Did you at any time keep a roster of scientific and specialized personnel
for the use of any other Government agency in any other area or for any
other use?
(b) Are such files still in existence?
(o) If not, what disposition was made of them, at what time?
(d) If they are still in existence the committee desires to see them .
10. Prior to 1949, the council, from time to time, for specific and limited pur-
poses related to its own activities, gathered information about the professional
qualifications of persons with special competence in such fields as Byzantine
studies, slavic studies, American studies, musicology, Indic studies, near eastern
studies, and the like . These collections were of only temporary value, and
are no longer in existence .
Since 1949 we have collected information of this kind in connection with the
national registration in the humanities and social sciences . The character of
that registration and the work on it is described fully i11 the statement submitted
by the council to the committee on July 21, 1954, both under the heading, "The
Problem of Highly Trained and Specialized Personnel," and on pages 17 and 18
of the mimeographed version of the statement . The committee is at liberty to
examine the files, in which such information is recorded on IBM cards .
11. (a) If such a roster was maintained, what use was made of it?
(b) To what Government agencies were names suggested?
(c) Were names suggested to any other agencies, or to individuals? If so,
please name all such agencies or individuals .
(d) Who compiled such lists?
(e) Were they requested by someone outside the Council of Learned Socie-
ties? If so, please explain fully the circumstances .
(f) If the names were suggested spontaneously by the council without prior
request by the person or agency to whom given, how was the decision
to do so arrived at by the council?


(g) Was it the decision of an individual? If so, identify such individual
fully .
(h) If by action of the council, explain the circumstances fully .
Please send to the committee, in triplicate, all lists prepared by the
council, identifying fully those listed, and indicating to whom sent and
at what date.
The general purposes served by the national registration of the humanities
and social sciences and the council's practices in regard to requests for informa-
tion about personnel contained in the registration is described in the council's
statement to the committee of July 21, 1954 .
The registration has been open to the inspection of Government agencies or
any other employer . The Division of Exchange of Persons of the Department
of State and the Division of External Research of the Department of State
have made use of the information contained in the registration in this way : viz .,
members of these divisions visited the council's offices and the workings of the
filing system were explained to them . These representatives went through the
files themselves and made their own selections of names for them . Officers of
the council were neither concerned with nor consulted about the use that was
made of these names, if any. The only information of this character supplied
by the council to the Department of the Army related to one historian, and was
given as illustrative of the type of information available in the national registra-
tion upon request .
The following private agencies have received information from the registration
on or about the dates indicated in regard to the types of specialized personnel
indicated below.
June 1954 : Johns Hopkins University, instructor of French literature .
June 1954 : Reed College, Instructor of philosophy .
May 1954 : University of Minnesota, teacher of Scandinavian history .
April 1954 : Lewis W. and Maud Hill Family Foundation, director for St .
Paul Council of Arts and Sciences .
January 1954 : Rice Institute, instructor of modern European history .
November 1953 : University of Rochester, senior economist, international
economics.
March 1953 : Board on Overseas Training and Research (Ford Foundation),
political scientists with experience in Turkey, Iran, India, and southeast Asia .
In each of these cases the council was requested to supply the information .
It was compiled under the supervision of Mr. J . F . Wellemeyer, Jr ., staff adviser
on personnel studies, on the basis of IBM cards containing in code the responses
to questionnaire submitted by persons with specialized training . The names of
persons as to whom information was submitted to the foregoing groups are
attached in triplicate as requested .
The council is a member of the Conference Board Committee on International
Exchange of Persons, which participates in the selection of recipients of Ful-
bright awards . In this connection the registration has been used on several
occasions to develop lists of persons for the use of the council's representative
on the conference board committee.
12 . The Reporter for April 29, 1952, contains the following statement at page 22 :
"The personnel selected for Government agencies in the Far East
was picked from a roster of èxperts' made up by the Council of
Learned Societies under the direction of Mortimer Graves ."
Is this an accurate statement?
12 . The full text of the quotation to which you refer is as follows
"[Mr. Kohlberg's] thesis, a simple one, he has summed up substantially as
follows, to the student previously quoted
" `There is a great conspiracy aimed at the destruction of the United States .
Its method is to say "Europe first" in order to throw away Asia, then to do
something about Asia only after it is too late, thus throwing away Europe as
well. (Kohlberg does not appear to consider that the Asia Firsters could, with
equal justice, be accused of the same strategy in reverse .) Recruiting for the
great conspiracy has been going on for years . Its main tools are Communist
ideology and heavy bribes ; $20 million a year is spent on buying members and
operating the ring, says Mr . Kohlberg with conviction . During the Second
World War the great conspiracy worked to deliver Asia to Russia . The per-
sounehselected for Government agencies in the Far East -was picked from a roster
of "experts made up by the Council of Learned Societies under the direction
of Mortimer Graves.'"

I need not point out that the statement you quoted is not asserted by the
Reporter magazine to be a fact ; it is asserted to be Mr . Alfred Kohlberg's
version of the facts . I have no firsthand knowledge as to how the personnel
for Government agencies in the Far East was selected, hence I cannot vouch
for the truth or falsity of the statement quoted . My belief is that it is nonsense.
13 . Are you acquainted with any of the following individuals?
William Walter Remington
George Shaw Wheeler
Maurice Halperin
Luke I . Wilson
Mary Jane Keeney
Owen Lattimore
Robert Selberstein
Antoli Gromov
Harriet Moore (Gelfan )
Joseph Fels Barnes
Kathleen Barnes
13 . I never met William Walter Remington .
A George Wheeler (middle name unknown) was active in the Washington
Committee for Aid to China in 1939-41 (see paragraph 1 (b) ), and I knew him
in that connection . I would not recognize him if I met him on the street today .
In 1945 or 1946 a committee on world area studies was set up by the American
Council of Learned Societies and the Social Science Research Council . I was a
member of that committee as was Mr . Maurice Halperin . I attended only one
meeting of the committee and at that meeting I met Mr . Halperin . I have not
seen him since and I would not recognize him if I met him on the street today .
I have never met Mr . Luke I. Wilson. While I was in the Near East in 1948-49,
a Washington real-estate agency (Gilliat of Georgetown) rented my house to a
Mrs. Luke Wilson. I met her only once, upon my return, as she was taking the
last of her belongings from my house . I do not know whether her husband lived
with her in the house, or, indeed, whether she had one or not at the time . At
any rate, I never met him .
I have met Mrs . Mary Jane Keeney, perhaps 3 or 4 times at gatherings con-
cerned with the Far East . Most of these meetings were from 10 to a dozen
years ago, and the last such meeting was at least 6 or 7 years ago . I do not think
I would recognize her if I met her on the street today.
I first met Owen Lattimore many years ago when we were brought together
by our common interest in matters connected with the Far East . As he is one
of the most eminent scholars concerned with the Far East, it was inevitable that
I should meet Mr. Lattimore very early in the course of my own work for the
council in stimulating interest in Far Eastern studies in American institutions
of higher learning . Drawn together by this common interest, we became close
friends and have remained so for perhaps 25 years .
I have never heard of Robert Selberstein or Antoli Gromov .
I met Harriet Moore, Joseph F . Barnes, and Kathleen Barnes several times
from 10 to 12 years ago . The meetings were in connection with my duties as
trustee of the Institute of Pacific Relations and were of the character described
in paragraph 14 below . I have not seen any of these persons since my term as
trustee of the Institute of Pacific Relations expired in 1948 .
14 . You are shown as vice chairman and trustee of the Institute of Pacific Rela-
tions in Who's Who from 1942 to 1948 . Please name the persons, directly
or indirectly, concerned with the institute with whom you had contact
with regard to the activities of the institute, or with regard to policy
or recommendations in Far Eastern matters .
14. I was a vice chairman and trustee of the Institute of Pacific Relations from
1942 to 1948 . The activities of the institute were primarily directed toward the
fields of economics, politics, and social sciences in the Far East . I considered
my function on the board to be that of stimulating greater interest on the part
of the institute in the Far Eastern cultural activities and the humanities with
which the council is principally concerned, as explained in the statement filed with
your committee on July 21, 1954 . So far as I know, I was appointed trustee of
the institute for this reason and was regarded in this light by my fellow trustees
and by the staff of the institute . When I had occasion to discuss the question of
institute activity and policies along the lines described above I did so with my
fellow trustees and with members of the staff of the organization, principally Mr.
E . C. Carter and Mr. William L . Holland.

"TAX-EXEMPT FOUNDATIONS 1229

15. Was your connection with the institute terminated by resignation or by
expiration of a specific term of office? If the resignation was at the sug-
gestion of some other party please identify fully . If the resignation was
your own decision, please give the reasons therefor .
15 . When my term of office expired I requested that I not be renominated . I
did this because I think one ought not to occupy a post of this character for
more than 4 or 5 years . I am still a dues-paying member of the American Insti-
tute of Pacific Relations.
VERIFICATION
DISTRICT OF COLUMBIA,
City of Washington, Ss :
I, Mortimer Graves, swear and affirm that I am executive director of the
American Council of Learned Societies ; that I have read and am familiar with
the contents of the foregoing statement ; and that to the best of my knowledge
and belief every statement of fact contained therein is true .
MORTIMFR GRAVES,
Executive Director, American Council of Learned Societies .
Subscribed and sworn to before me this 1st day of November 1954 . My com-
mission expires November 1, 1955 .
MARY E . NOBEL, Notary Public,
List of individuals sent to institutions which requested information from the

National Registration of the Humanities and Social Sciences-Received from
Mr. Graves Nov. 15,1954
RICE INSTITUTE
Name Position Institutional affiliation
Bishop, Wm . Rowley, Jr____ Assistant professor, history Albright College, Reading, Pa.
Crapster, Basil Long __ Instructor in history Gettysburg College.
Edwards, Marvin Louis Lecturer in history Columbia University.
Free, Henry John, Jr Graduate instructor, history .___ Northwestern University .
Gossman, Norbert Joseph- __ Instructor in history State University of Iowa
Motlow John D -----do Sacramento State Ccllege .
Raymond, Harold Bradford . Instructor in history (September University of Delaware.
1998-September 1951) .
Shane, Theodore King Teaching fellow, European history, Indiana University .
1950-51 .
Umscheid, Arthur George___ Professor of history Creighton University, Omaha,
Nebr.
Wilbur, Wm . Cuttino, Jr____ Instructor in history Muhlenberg College .
BOARD ON OVERSEAS TRAINING AND RESEARCH (FORD FOUNDATION)
Arens, Herman J . A . C Bigelow teaching fellow University of Chicago .

Austin, Eduardo D . S Fellowship of J . H . Whitney Foun- Georgetown University.
dation (to July 1952) .
Banani, Amin Research assistant Hoover Institute, Stanford Uni
versity .
Beck, George T International economist Department of Commerce .
Boushy, Theodore F Professor of history _ . . Wayland College, Plainview, Tex .
Carroll (Rev .)Thos. D Professor of Chinese history Chinese Language School, Manila,,
Philippine Islands .
Cherry, H. Dicken Principal Hartsville School, Hartsville, Ind.
Dean, Vera Micheles Research director and editor Foreign Policy Association, New
York City .
E aston, Stewart C Instructor in history City College of New York .
Fletcher, Arnold Charles____ Lecturer In history University of Southern California .
Freeman, Edwin Ruthven___ Intelligence research analyst Department of State .
Gerth, Donald Rogers Psychological warfare officer U. S . Air Force.
Ghosh, Suprakas Editor and head, India unit Department of State, International
Broadcasting Division, New York
City .
Goldner, Werner Ernst Lecture assistant Stanford University .
Haddad, Jamal Information specialist, radio script- Department of State, Voice of Amer-
writer. ica, New York City .
Halls, Philip J Policy report officer Department of State .
Harding, Clifford H Instructor Temple University, Philadelphia,,
Pa .
Hart, Henry C Assistant professor, public adminis- University of Wisconsin .
trator.
Hatami, Abolghassen J Personnel officer and administrative United Nations .
officer .

Mr. Graves Nov . 15,1954-Continued
BOARD ON OVERSEAS TRAINING AND RESEARCH (FORD FOUNDATION)-Con .
Heinrichs, W aldo Huntley_ _ _ Professor Middlebury College .

Hitti, Philip K Professor of Semitic literature Princeton University.
Hurewitz, Jacob C Lecturer in Middle East political Columbia University.
history and government .
Kahin, George McT Assistant professor of government, Cornell University .
executive director, southeast Asia
program .
Kattenburg, Paul M Intelligence research specialist, Department of State .
southeast Asia .
Kazemzadeh, Firuz Publishing Branch Department of State, New York .
Lacin, Mahmut N Associate professor Drake University .
Laurie, Arthur Bruce --------------------------------------
Assistant professor of political Marshall College, Huntington, W .
science . Va.
Lenczowski, George Visiting professor of political science_ University of California.
Liebesny, Herbert J Research analyst Department of State .
McDougall, Archibald --------------------------
Associate professor of history and Hastings College, Hastings, Nebr.
social science .
Martin, Leslie John Assistant director International Relations Center, Uni-
versity of Minnesota .
Mill, Edward W 2d secretary, American Embassy, U . S . Foreign Service, Department of
Manila, and American Consul, State, Manila, Phlippine Islands,
Indonesia. and Surabaya, Indonesia.
Mohan, Pearey Political affairs officer United Nations .
Ogden, David L . O . and M . examiner Sacramento Signal Depot, U . S .
Army, Sacramento, Calif.
Pincus, Jobn A Project officer Department of State .
Robinson, Richard Dunlop__ Foreign observer Institute of Current World Affairs,
New York City .
Russell, James Earl Associate professor of education Teachers College, Columbia Uni-
versity.
Rustow, Dankwart A__ . __-- Faculty fellowship (Ford Founda- Oglethorpe University .
tion, to August 1952) .
Shuck, Luther Edward, Jr__- Visiting professor of political science Korea, Philippine Islands, and
(grantee Smith-Mundt Act) . Indonesia.
Shah, Hiru Chhotalal Moderator, International Radio University radio station, Ann Arbor,
Roundtable, WHOM . Mich .
Stevens, Harry R Assistant professor Duke University .
Stubbs, Roy Manning Intelligence research analyst Department of State.
Talbot, Phillips Executive director American universities field staff,
New York .
Thomas, Steven Alexander- - Manager, Foreign Exchange Fund De Javasche Bank, Djakarta, In-
of Indonesia (to 1949) . donesia.
Vandenbosch, Amry Professor of political science University of Kentucky.
Whitelaw, Wm . Menzies__ Professor of history American International College,
Springfield, Mass .
Wolf, Charles, Jr Economist, Far East Program Di- Economic Cooperation Administra-
vision . tion .
UNIVERSITY OF ROCHESTER
Chief Economist, Asia Division

Basch, Antonin -------------- International Bank for Reconstruc-
tion and Development .
Beecroft, Eric Armour Loan officer Do .
Blaser, Arthur Frederick, Jr-
Economist Office of International Finance, U . S .
Treasury Department .
Casadaay, Lauren W Director, bureau of business research University of Arizona .
Chudson, Walter A Principal officer, economics United Nations.
Condliffe, John Bell Professor of economics University of California, Berkeley,
Calif .
Ellis, Howard S ----- do Do.
Ellsworth, Paul Theo Special adviser International Bank for Reconstruc-
tion and Development .
Franck, Peter Goswyn Visiting associate professor and
------ Haverford College, Haverford, Pa.
director of research .
Chief, Central and Eastern Euro- Federal Reserve Bank, Washington,
pean Section. D. C.
Gilmore, Eugene Allen, Jr___
Foreign Service officer, cl-ss II Department of State .
Hayes, Samuel Perkins, Jr_-_
Chief, United States special techni- Mutual Security Agency, Djakarta,
cal and economic mission to Indo- Indonesia .
nesia .
Kriz, Miroslav A Economist Federal Reserve Bank of New York.
Luthringer, George F Director, Latin American, Middle International Monetary Fund.
and Far Eastern Department .
Malenbaum, Wilfred Chief, Investment and Economic Department of State .
Development Staff .

TAX-EXEMPT' FOUNDATIONS 1231

Mr. Graves Nov. 15,1954-Continued
UNIVERSITY OF ROCHESTER-Continued
Nurske, Ragnar Professor of economics Columbia University .

Patterson, Gardner Director of international finance Princeton University.
section and associate professor of
economics .
Radius, Walter A Director, Office of Transport and Department of State.
Communications .
Sturc, Ernest Assistant Director, European and International Monetary Fund.
North American Department .
Van Sant, Edward R International economist Department of Defense.
Staley, Alvah Eugene Senior economist Stanford University .
Vernon, Raymond Deputy Director, Office of Economic Department of State.
Defense and Trade Policy .
Williams, Wilbur Laurent___ Chief, Steel Section, Export Supply Office of International Trade, De-
Branch . partment of Commerce.
Woodley, W. John R Economist International Monetary Fund .
Wu, Yuan-lf Research economist Stanford Research Institute, Palo
Alto, Calif.
UNIVERSITY OF MINNESOTA
Ander, Oscar Fritiof Professor of history Augustus College, Rock Island, Ill .
Anderson, Albin Theodore__ Assistant professor of history University of Nebraska.
Bowman, Francis J . E Professor of history University of Southern California .
Clausen, Clarence Arthur -_- Cultural attachi, American Em- Department of State .
bassy, Stockholm .
Falnes, Oscar J Associate professor of history New York University.
Hovde, Bryn I Visiting professor of Scandinavian University of Wisconsin (1951-52) .
area studies .
Lindgren, Raymond E Associate professor of history Vanderbilt University .
Schodt, Eddie W Acting Branch Chief for Northern Department of State .
European Branch in OIR .
Scott, Franklin Daniel_ __ _ Professor of history Northwestern University .
Sorensen, Roland A____. Visiting professor of history Delaware State College, Dover, Del .
Wuorinen, John Henry Professor of history Columbia University.
LOUIS W . AND MAUDE HILL FAMILY FOUNDATION
Bach, .Otto Karl Lecturer, art history Denver Art Museum, Denver, Colo .
Faulkner, Ray Nelson Director, art gallery and museum ; Stanford University .
executive head, department of art
and archaeology ; associate dean,
School of Humanities and Sciences .
Frankenstein Alfred V Music and art critic San Francisco Chronicle .
Kwiat, Josepli J Assistant professor of English and University of Minnesota .
general studies .
Phillips, John Marshall Director, art gallery; curator, Amer- Yale University .
ican art .
Rathbone, Perry I Director City Art Museum, St . Louis, Mo.
Smith, John B Dean Kansas City Art Institute .
Stout, George Leslie Director Worcester Art Museum, Worcester,
Mass.
THE JOHNS HOPKINS UNIVERSITY
Bates, Blanchard W Assistant .professor of French Princeton University .

Bowen, Willis Herbert Associate professor of French University of Oklahoma .
Brown, Harcourt Professor of French language and Brown University .
literature .
Burgess, Robert M Assistant professor of French Montana State University .
Cosentini, John Walter Associate professor of French St . John's University, Brooklyn.
Crisafulli, Alessandro S ----- do The Catholic University of America.
Frame, Donald Murdoch____ -----do Columbia University .
Gravit, Francis West -----do Indiana University .
Hassell, James Woodrow, Jr- do University of South Carolina .
Miller, William Marion Professor of Romaniclanguages Miami University, Oxford, Ohio .
Morrissette, Bruce A Associate professor of romance lan- Washington University, St . Louis.
guages .
Oliver, Alfred Richard Assistant professor of French and Washington and Jefferson College .
German .
Seeker, Edward D . _- Professor of French Indiana University .
Smiley, Joseph Royall ----- do University of Illinois .
Taylor, Cecil Grady Professor of French ; dean, College of Louisiana State University.
Arts and Sciences .
49720-M-pt . 2-x--,19


Mr. Graves Nov . 15, 1954-Continued
THE JOHNS HOPKINS UNIVERSITY-Continued
Wadsworth, Philip Adrian__ Intelligence officer (1952) U . S . Navy, Washington .

Weinberg, Bernard Professor of romance languages Northwestern
University
University.
of North Carolina .
Wiley, William Leon Professor of French
REED COLLEGE
Chambers, Lawson P Professor (emeritus) of philosophy_ - Washington University, St . Louis .

Clapp, James Gordon Assistant professor of philosophy____ Hunter College, New York City .
Clark, Gordon H ._ - Professor of philosophy Butler University, Indianapolis .
Cleve, Felix M Unemployed in1952
DeBoer, Jesse Associate professor of philosophy University of Kentucky .
Evans, Melbourne G Instructor in philosophy Syracuse University (1948-51) .
Foss, Martin Lecturer in philosophy___ Haverford College .
Gerhard, Wm . Arthur Professor of philosophy Brooklyn College .
Hakmon, Frances B -------------------------------------- Briarcliffe Junior College .
Jones, Wm . Thomas of philosophy
Pomona College, Claremont, Calif .
Kaufmann, Walter A Assistant professor of philosophy---- Princeton University .
Levinson, Ronald B -------------------------------------- University of Maine .
Matson, Wallace Irving Assistant professor of philosophy ---- University of Washington, Seattle .
O'Neil, Charles Joseph Professor of philosophy Marquette University, Milwaukee. .
Reither, Wm . Harry Assistant professor of philosophy_-__ Ohio State University.
Schrader, George A ., Jr do----of philosophy
- Yale University .
Stine, Russell Warren Professor Muhlenberg College, Allentown, Pa .
STATEMENT OF CONGRESSMAN WILLIAM G. BRAY, OF INDIANA, REGARD-

ING THE NATIONAL HOME LIBRARY FOUNDATION OF WASHINGTON,
D. C.
The Honorable William G . Bray, Representative of the Seventh District of
Indiana, presented the following statement relative to the National Home
Library Foundation of Washington, D . C., by means of which, Congressman
Bray stated, with the use of Government loans, rental fees paid by the Federal
Government, and of tax exemptions, huge profits were diverted from . public
philanthropy to the enrichment of private interets and/or individuals .
Congressman Bray stated that his interest in the National Home Library
Foundation stemmed from a constituent, Frances Sinclair, of Sullivan, Ind .
Until her recent serious illness, Miss Sinclair was prominent in the field of
employee counseling in nationally and, internationally known retail organiza-
tions, notably Marshall Field & Co . and Julius Garlinckel & Co. ; and she was a
financial "angel" as well as one of the original sponsors and promoters of the
National Home Library Foundation.
In brief, the history of this foundation is as follows
The late Sherman Mittell, of Washington, D . C ., was active in 1933 and later
years in furnishing educational material to the Civilian Conservation Corps and,
subsequently, to the armed services until his death in 1942 . He became in-
terested in providing for juvenile and adult education on a community level
through public and private libraries, and conceived the idea of establishing a
foundation for that purpose . This became the National Home Library Founda-
tion, which has numbered among its trustees such, eminent citizens as Justice
Felix Frankfurter, former Gov. Paul V . McNutt, of Indiana . Miss Sinclair
was extremely interested in the project from its inception, and contributed
liberally of her personal funds to underwrite many of the vital expenses, as
well as a vast amount of her own time and energy to its development .
The Mount Vernon Trust Co ., a Washington bank, was in financial difficulties
in the early thirties, as were so many other banks in that period . Its largest
depositor was the International Association of Machinists of which the late
Emmett C . Davison was general secretary-treasurer . Mr . Davison, with the
aid of the Reconstruction Finance Corporation, succeeded in salvaging assets
and converting the bank into a mortgage company under the name of the Mount
Vernon Mortgage Co .


At that time, there was a scarcity of office space in the city of Washington, and
the Federal Government, among others, was urgently in need of space . Mr.
Mittell owned an option_ on valuable property which was ideal for that purpose,
at the corner of Connecticut and Rhode Island Avenues NW ., but lacked the
funds to finance the same . By combining the assets of the closed bank (Mount
Vernon Trust Co., later Mount Vernon Mortgage Co .) and the real-estate
holdings of the National Home Library Foundation set up by Mr. Mittell, and
obtaining financing from the Reconstruction Finance Corporation, the present
Longfellow Building was erected on the site in question . Prior to the con-
struction of the building, and prior to RFC's financing, a commitment had been
obtained whereby the Federal Government (General Services Administration)
would lease all of the office space for a period of years, at mutually agreed upon
rentals ; and, in fact, the architectural plans for the building were drawn specif-
ically to accommodate the peculiar needs of the Federal agency that would
occupy it.
Mount Vernon Mortgage Co .'s contribution consisted of its pledged assets of
$750,000 held by RFC against notes for $600,000, which sum had been reduced by
Mount Vernon, by repayment, to $250,000 .
The Longfellow Building Corp . was set up with 2,000 shares of no-par common
stock, of which National Home Library Foundation received 1,200 shares, or
60 percent, and the Mount Vernon Mortgage Co . the balance of 800 shares, or
40 percent. The Reconstruction Finance Corporation held all of the preferred
stock as security for its loan . In the intervening years the entire RFC indebt-
edness has been repaid, the preferred stock retired, and the ownership of the
Longfellow Building now reposes entirely in the common stock, with an esti-
mated current cash value of $2,500,000. (See U. S . A . v. Mount Vernon Mort-
gage Co., now pending in the United States District Court for the District of
Columbia, Civil No. 4848-51 ; trial judge, Hon . Burnita S . Matthews. )
Founder and Director Mittell, of the National Home Library Foundation, lack-
ing ready cash, used shares of the Longfellow Building Corp . common stock (of
which he was owner, through the foundation) to meet pressing obligations of the
foundation for salaries, expenses, fees, etc ., in connection with the building opera-
tions, which reduced his holdings from 60 to 51 percent of the total common stock .
Needing further funds, Mr . Mittell borrowed some $23,000 from his partners in
the building project, the Mount Vernon Mortgage Corp ., against which he pledged
his 51 percent of the common shares of nominal value at that time in view of the
still outstanding and prior preferred stock pledged to RFC .
After Mr. Mittell's death in 1942, his, widow, now Mrs . Fanny Sessions Mittell
Caminita, then trustee of the foundation, transferred title to all of the assets of
the foundation (Mr. Mittell's remaining 923 shares of common stock in Long-
fellow Building Corp.) to the Mount Vernon Mortgage Co., allegedly in settle-
ment of Mr. Mittell's indebtedness .
Through these transactions, Mount Vernon Mortgage Co . was able to acquire
complete ownership of the total assets of the National Home Library Founda-
tion, to pocket all of the profits that had accrued to the foundation, and, in effect,
to liquidate the foundation and its philanthropic purposes.
Subsequently, in 1945, the Mount Vernon Mortgage Co . restored to Mrs. Mittell
Caminita 100 shares of the foundation's Longfellow Building Corp . common stock
(valued at $1,000-plus per share) and, as revealed by testimony in Civil Action
4848 51-U. S. A. v. Mount Vernon-previously referred to, Mrs. Caminita burned
all of the records of the foundation .
In the interim, as further revealed by the testimony in the pending lawsuit,
the Internal Revenue Bureau has recovered in excess of $50,000 in income taxes,
and would have collected additional sums except for the statute of limitations ;
and the General Services Administration, in revising its rent formula for the
Longfellow Building space, has likewise recovered approximately another $50,000 .
Testimony of these facts was obtained in hearing of the pending lawsuit from
officials of the Mount Vernon Mortgage Co . itself.
During the period from 1942 to 1945, the Mount Vernon Mortgage Co . was also
the defendant in other lawsuits in connection with the Longfellow Building Corp .,
filed against it by several component units of the American Federation of
Labor, including the late Mr. Davison's union, the International Association of
Machinists, which recovered large sums of money in out-of-court settlements .
The current lawsuit, filed against the Mount Vernon Mortgage Co . by the
United States of America, asks for the recision of all of the transactions by which
Mount Vernon acquired complete control and ownership of the Longfellow Build-
ing, less the 100 shares now in the possession of Mrs . Caminita, and for the
appointment of successor trustees to operate the foundation and administer its

rightful funds for the purposes for which it was established, i . e., for the benefit
of the American people .
The pending suit exposes, for the first time, the real issues involved, and has
received widespread newspaper publicity . The Committee on Tax Exempt Foun-
dations is in possession of full information, but feels that this condensed revela-
tion of the salient facts may be useful in uncovering other instances in which,
by the same or by entirely different means, tax-exempt funds or profits, or both,
might have been or could be manipulated for the benefit of private purses, to the
loss not only of the intended and rightful beneficiaries-the American people-
but to the loss of the Federal Treasury in income and other taxes . It is, there-
fore, the committee's recommendation that this matter be further investigated
through appropriate committees or commissions-perhaps permanent-or through
executive departments who have heretofore failed to realize the significant and
widespread influence of foundations on the national economy .
The case of the National Home Library Foundation is also peculiarly timely
because the Congress is now engaged in a lend-lease office-building program
similar in some respects to the Longfellow Building project, and the Congress
may wish to set up additional safeguards .

APPENDIX
BIBLIOGRAPHY ON EDUCATIONAL AND CHARITABLE FOUNDATIONS
BOOKS AND DOCUMENTS
A. W . Mellon Educational and Charitable Trust . A report of its work, for the
five years, 1946 through 1950 . Washington, 1951 . 49 p .
(not catalogued)
American foundations and their fields . [V. 1]-1931-New York, Twentieth
Century Fund, Inc . [1931]-35 ; Raymond Rich Associates, 1939-
AS911 .A2A6
Andrews, Frank . Corporation giving . New York, Russell Sage Foundation,
1952 . 361 p. HV95.A76
Philanthropic giving . New York, Russell Sage Foundation, 1950 .
HV91 .A47
Anthony, Alfred W . Changing conditions in public giving. New York, Federal
Council of the Churches of Christ in America, 1929 . 139 p. HV41.C63
Ayres, Leonard P . Seven great foundations . New York, Russell Sage Foun-
dation, 1911 . 79 p. LC 243.A8
,Casey, William J . Tax planning for foundations and charitable giving, by
William J . Casey, J . K. Lasser [and] Walter Lord . [Roslyn, N . Y .] Business
Reports [1953] 234 p . (not catalogued)
. Use of the foundation in your estate planning . New York University
6th Annual Institute on Federal Taxation, 1947 . Albany, Matthew-Bender,
1948 . p . 98-107 . HJ2360.I63
Chambers, Merritt M . Charters of philanthropies ; a study of selected trust
instruments, charters, bylaws, and court decisions . New York, 1948. 247 p.
HV88.C45
Charles Hayden Foundation . To the ultimate benefit of mankind ; the story of
the Charles Hayden Foundation. 71 p . (not catalogued)
, Clague, Ewan . Charitable trusts . Philadelphia, 1935 . 138 p . ([Joint Com-
mittee on Research of the Community Council of Philadelphia and the
Pennsylvania School of Social Work] Publication No . 10) HV99 .P5C63
, Coffman, Harold C . American foundations : a study of their role in the child
welfare movement . New York, Association Press, 1936 . 213 p. HV741 .C54
'Commission on Financing Higher Education . Higher education and American
business. New York [1952] 37 p . LB2336.C6
,Coon, Horace. Money to burn ; what great American philanthropic founda-
tions do with their money . New York, Longmans, Green, 1938, 352 p.
HV97.A306 1938
Dillard, James H., and others. Twenty-year report of the Phelps-Stokes Fund,
1932. 127 p. LC243 .P5
Edward W. Hazen Foundation . The Edward W. Hazen Foundation, 1925-1950 .
New Haven, 1951 . 59 p . (not catalogued)
Elliott, Edward D . and M . M. Chambers . Charters of philanthropies : a study
of the charters of twenty-nine American philanthropic foundations . New
York, 1939 . 744 p. HV97.A3.E55
Faris, Ellsworth, and others . Intelligent philanthropy . Chicago, University
of Chicago Press, 1930. 322 p . HV40 .F3
Flexner, Abraham . Funds and foundations . New York, Harper, 1952' . 146 p.
AS911 .A2F6
Ford Foundation . Report of the study for the Ford Foundation on policy and
program, November, 1949 . Detroit, 1949. 139 p. AS911 .F6A446
Fosdick, Raymond B. The story of the Rockefeller Foundation . New York,
Harper, 1952 . 336 p. HV97.RGF6
1235

The Fund For Adult Education . Pasadena, California . The challenge of life-
time learning. [Pasadena, 1953?] 40 p. (not catalogued)
Glenn, John M., and others. Russell Sage Foundation, 1907-1946 . New York,
Russell Sage Foundation, 1947. 2 v . HV97 .R8.G55
Golden Rule Foundation . Constructive philanthrophy : an historical sketch, a
review, and an interpretation of the Golden Rule Foundation . [New York,
1941?] HV97 .G56A5 1941
Goldthorpe, John H. Higher education, philanthropy and federal tax exemption .
Washington, American Council on Education, 1944 . 40 p. L13 .A384 no . 7
Hanover, New York. The fine arts in philanthropy . New York, Dept . of Philan-
thropic Information, Central Hanover Bank and Trust Co . [1937] 61 p .
N6505 .H27
Harrison, Shelby M . and Frank Andrews. American Foundations for social
welfare . New York, Russell Sage Foundation, 1946 . 249 p. AS911 .A2H3
Hollis, Ernest V . Philanthropic foundations and higher education. New York,
Columbia University Press, 1938. 365 p. LC243 .H6 1938 a
Howard Heinz Endowment . A report of its work, to December 31, 1950 . 1951 .
40 p . (not catalogued)
Jenkins, Edward C. Philanthropy in America . New York, Association Press,
1950. 183 p. HV91 .J4
Jenks, Thomas E. The use and misuse of Sec . 101 (6) . New York University
7th Annual Institute on Federal Taxation, 1948. Albany, Matthew Bender,
1949 . p. 1051-1062. HJ2360.163
Josephson, Emanuel Mann . Rockefeller, "internationalist," the man who mis-
rules the world . New York, Chedney Press [1952] 448 p. E744 .R65J6
Keppel, Frederick P . The foundation : its place in American life . New York,
Macmillan, 1930. 113 p . AS911 .A2K4
. Philanthropy and learning . New York, Columbia University Press,
1936. 175 p. LA7 .K4
Kiplinger Washington agency. Tax exempt foundations, 1951. 4 p. (The
Kiplinger tax letter) HC101 .K5
Lasser, Jacob K . How tax laws make giving to charity easy, a check list of
federal tax aids for the solicitor and the giver. New York, Funk and
Wagnalls [1948] 106 p. Law library
Leavell, Ullin W . Philanthropy in Negro education . Nashville, George Pea-
body College for Teachers, 1930 . 188 p. LC2801 .L37 1930
Lester, Robert M . Forty years of Carnegie giving . New York, Scribner's, 1941 .
186 p. AS911 .C3L4
. A thirty-year catalog of grants. New York, Carnegie Corporation of
New York, 1942. 147 p . AS911 .C3L42
Lindeman, Eduard C. Wealth and culture : a study of one hundred foundations
and community trusts during the decade 1921-1930. New York, Harcourt,
Brace, 1936. 135 p. AS911 .A2L5
National Planning Association. The manual of corporate giving, by Beardsley
Ruml. Washington, 1952. 415 p . HV95 .N38
Ogg, Frederic A. Foundations and endowments in relation to research . New
York, Century, 1928. p . 323-361 AZ105 .A6
Orton, William A. Endowments and foundations . Encyclopaedia of the social
sciences . New York, Macmillan, 1931 . v . 5 : 531-537 . H41 .E6
Rockefeller Foundation. Directory of fellowship awards for the years 1917-
1950 . With an introd . by Chester I . Barnard. New York [1951] . 286 p.
LB2338 .R6
Russell Sage Foundation . American foundations for social welfare . New York,
Russell Sage Foundation, 1938 . 66 p. HV97 .R8A5 1938
Sattgast, Charles R . The administration of college and university endowments .
New York, Teachers College, Columbia University, 1940 . 125 p . (contribu-
tions to education, no . 808) LB2336 .S3 1940 a
Savage, Howard J . Fruit of an impulse ; forty-five years of the Carnegie Foun-
dation, 1905-1950. New York, Harcourt, Brace, 1953 . 407 p.
LC243 .C35S3
Scudder, Stevens and Clark . Survey of university and college endowment funds
[Prepared by the] Institutional Department. New York [1937]
LB2336 .S35
Taylor, Eleanor K . Public accountability, of foundations and charitable trusts .
New York, Russell Sage Foundation, 1953 . 231 p . (not catalogued)


Tilt, James T . Legal incidents to the investment of the corporate funds of
charitable corporations organized under the laws of the State of New York,
with comparative analysis of decisional and statutory law in other juris-
dictions of the United States . [ ] 1952 . 821. Law library
U. S . Congress. House. Committee on Ways and Means. Hearings, revenue
revision, 1947-1948. Washington, U . S . Govt . Print. Off., 1948
HJ2377.A2
Hearings, revenue revision of 1950. Washing-
ton, U . S . Govt . Print Off., 1950 HJ2377 .A3 1950
Senate . Committee on Interstate and Foreign Commerce . In-
vestigation of closing of Nashua, N . H ., mills and operations of Textron,
Inc . Hearings . Washington, U . S. Govt.' Print. Off., 1948-49 . 2 v.
HD9940 .U4A55
U. S. Congress . Senate . Committee on Interstate and Foreign Commerce .
Investigation of closing of Nashua, N . H., mills and operations of Textron,
Inc. Report. Washington, U . S. Govt. Print. Off., 1949. 32 p.
HD9859.T4U5 1949
House. Select Committee to Investigate Foundations and Other
Organizations. Final report . Washington, U . S. Govt . Print. Off., 1953.
15 p. (82d Cong ., 2d sess. House report no. 2514)
AS911 .A2U52 1953
Select Committee to investigate Tax-Exempt Founda-
tions and Other Organizations . Final report. Washington, U . S . Govt. Print.
Off., 1953 . 15 p. (82d Cong., 2d sess . House report no . 2514)
AS911 .A2U52 1953
Select Committee to Investigate Tax-Exempt Founda-
tions and Comparable Organizations . Tax-exempt foundations . Hearings
before the Select Committee to Investigate Tax-Exempt Foundations and
Comparable Organizations. House of Representatives, Eighty-second Con-
gress, second session on H. R. 561 . . . Nov . 18 . . . 25, Dec . 2 . . . 30, 1952.
Washington, U . S . Govt . Print . Off., 1953 792 p .
AS911 .A2U5
Office of Internal Revenue . Cumulative list of organizations contribu-
tions to which are deductible . . . Washington, U. S. Govt . Print . Off., 1950.
331 p. Law library
Viking Fund . The first ten years, 1941-1951 : including a report on the Fund's
activities, for the year ended January 31, 1951 . , 1951. 202 p.
(not catalogued)
Werner, Morris R . Julius Rosenwald. New York, Harper, 1939 . 381 p .
HV28.R6W4
World almanac and book of facts for 1953 . New York, New York World Telegram
and Sun, 1953 . p. 573-576. AY67 .N5W7
The Yearbook of Philanthropy, 1940-Presenting information and statistics cov-
ering American philanthropy since the year 1920 . New York, Inter-River
Press [1940- HV88 .Y4
ARTICLES
Anderson, H . A. Ford millions for education : fund for the advancement of edu-
cation and fund for adult education . School review (Chicago ) v. 59,
Sept. 1951 : 316-320. L11 .S55
Andrews, Frank E . The business of giving. Atlantic (Boston) v . 191, Feb . 1953 :
63-66 . AP2 .A8
. Foundations, a modern Maecenas . Publishers' weekly (New York v .
151, March 8, 1947 : 1464-1468. Z1219.P98
. New challenges for our foundations . New York Times magazine (New
York) April 3, 1949 : 16
Andrews, Frank . New trends in corporate giving . Social work journal (New
York), v. 33, Oct . 1952 : 172-176, 204 . HV1 .S647
. Philanthropy's venture capital . Educational record (Garden City,
N . Y.), v. 32, Oct. 1950 : 361-370. L11.E46
Aydelotte, Frank . Educational foundations with reference to international
fellowships . School and society (New York), v . 22, Dec. 26, 1925 : 799-803.
L11 . S36
Baker, Lawrence G . Community trusts-the new look in charitable giving. State
bar journal of California (San Francisco), v .'26, May-June 1951 : 177-181.
Law library
Bendiner, R. Report on the Ford Foundation . New York Times magazine
(New York), Feb. 1, 1953 : 12-13 .

Blackwell, Thomas E . The charitable corporation and the charitable trust

Washington University Law quarterly (St . Louis), v . 24, Dec . 1938 :1-45,
Law library
Bleicken, Gerhard D . Corporate contributions to charities : the modern rule .
American Bar Association journal (Chicago), v . 38, Dec. 1952 : 999-1002,
1059-1060. Law library
Bliven, Bruce. Ford's new venture . New republic (Washington), April 9, 1951 :
13-14. AP2 .N624
Brown, Robert C . The new restrictions on charitable exemptions and deduc-
tions for federal tax purposes . University of Pittsburg law review (Pitts-
burgh), v . 13, Summer 1952 : 623-646. Law library
Burke, Earl . The Giannini Foundation : how income from a $1,000,000 trust
will be spent for specialized banking training, other worthy purposes .
Burroughs clearing house (Detroit), Jan . 1953 : 31 . HG1501 .B9
But it's not easy to give money away . Business week (New York), Jan. 12,
1952 : 66-70. HF5001.1189
Carnegie Corporation investment saga . Business week (New York), Mar. 8,
1947 : 62-66 . HF5001 .B89
Charitable trusts for political purposes . Virginia law review (Charlottesville),
v. 37, Nov . 1951 : 988-1000 . Law library
Chodorov, Frank . Bribery by tax exemption . Human events (Washington),
v. 9, Sept . 17, 1952 . D410.118
Clarke, C. M . The Ford Foundation-Arkansas experiment . Journal of teacher
education (Washington), v. 3, Dec. 1952 : 260-264. LB1705 .N7
Company gifts : all time high . U. S . news and world report (Washington), v . 32,
Jan . 18, 1952 : 56-58 . JK1 .U65
Company gifts : bars go down . U. S. news and world report (Washington), v . 35,
Nov . 13, 1953 : 104-107. JK1.U65
Cooper, James W. Charitable community trusts, with special reference to New
Haven Foundation . Connecticut bar journal (Bridgeport), v . 25, March
1951 : 17-29 . Law library
Cox, Eugene E. Investigation of certain educational and philanthropic founda-
tions . Congressional record (Washington), 82d Cong ., 1st . sess ., v . 97 :
A4833-A4834 . J11 .R5, v . 97
Davis, Malcolm . The Carnegie Endowment for International Peace . Journeys
behind the news (Denver), v . 12, Sept . 20, 1950 : 317-320. D414.D4
Duling, G . Harold . Approach to foundations. Association of American Colleges
bulletin (Lancaster, Pa .), v. 39, May 1953 : 329-336. LB2301.A5
Dutton, William S . The Rockefeller foundation story : "Our mightiest ghost ."
Collier's (New York), April 28, 1951 : 18-19+ . May 5, 1951 : 22-23+ . May
12,1951 :24-25+ . May 19, 1951 : 28-29+ . AP2.C65
Eaton, Berrien C . Charitable foundations and related matters under the 1950
revenue act. Virginia law review (Charlottesville), v . 37, Jan. 1951 : 1-54.
v . 37, Feb . 1951 : 253-296. Law library
Charitable foundations tax avoidance and business expediency . Virginia
law review (Charlottesville), v . 35, Nov . 1949 : 809-861 . Law library .
Use of charitable foundations for avoidance of taxes . Virginia law
review (Charlottesville), v . 34, Feb. 1948 : 182-209. Law library
Edwards, Joel : $500,000,000 grubstaker . New York herald tribune, Feb . 1,
1953, sec. 7 : 13. [Concerns Bernard Gladieux]
Embree, Edwin R . The business of giving money away . Harper's magazine
(New York), v. 161, Aug. 1930 : 320-329 . AP2.H3
Timid billions. Harper's magazine (New York), v. 198, March 1949 :
28-37 . AP2 .H3
Faust, C. H . Role of the foundation in education . Saturday review (New York),
v . 35, Sept . 13, 1952 : 13-14+ . Z1219 .S25
Finkelstein, Maurice . Tax exempt charitable corporations : Revenue act of
1950 . Michigan law review (Ann Arbor), v . 50, Jan. 1952 : 427-434 .
Law library
Flexner, Abraham . Private fortunes and public future. Atlantic monthly
(Boston), v. 156, Aug . 1935 : 215-224 . AP2.A8
Ford Foundation . Fifteen million dollars to study peace . Business week
(New York), Oct . 7, 1950 : 30-32+ HF5001 .B89
. Social service review (Chicago), v . 26, March 1952 : 90-92 . HVl . S6
Foundations for health . American journal of public health (New York), v .
43, Feb. 1953 : 224-225 . RA421 .A41


Foundations on trial. Social service review (Chicago), v . 27, March 1953 :
89-90. HV1 .86
Fulton, William . Let's look at our foundations . American Legion magazine
(Indianapolis), v . 53, Aug . 1952 : 22-23, 42+ D570.A1A32
Glenn, John . M. The Russell Sage Foundation : forty years of social work
leadership. Compass (New York), Jan . 1948 : 14-18 . HV1.S647
Grubstakers. Time (Chicago), v . 60, Dec. 22, 1952 : 38-39 . AP2 .T37
Haines, Aubrey B . A half-billion for humanity : nature and work of the
Ford Foundation. America (New York), v . 90, Nov. 14, 1953 : 169-
171. BX801'.A5
Harrison, S . M . Foundations and public service. American journal of eco-
nomics and sociology (New York), v . 9, Oct. 1949 : 107-115 . H1 .A48
Heilbroner, Robert L. The fabulous Ford Foundation . Harper's magazine
(New York), v . 203, Dec. 1951 : 25-32. AP2.H3
High, Stanley . Design for giving. Saturday evening post (Phila .), v . 213,
Aug. 10, 1940 : 12-13, 53+ AP2 .S2
Hollis, Ernest V . Evolution of the philanthropic foundation . Educational rec-
ord (Garden City, N. Y.), v. 20, Oct. 1939 : 575-588 . L11 .E46
How to have your own foundation . Fortune (New York), v . 36, Aug. 1947 :
108-109+ HF5001 .F7
Hutchins, Clayton D . Planning foundation programs . School life (Washing--
ton) , v. 35, Dec . 19.52 : 46-47 . L11 . S445
Kandel, I . L . Educational foundations and progress . School and society (Lan,
caster, Pa .), v. 76, July 26,1952 : 59. L11 .S36
Kandel, I . L. Educational foundations and the quality of higher education,,
School and society (Lancaster, Pa .), v. 77, Feb . 14, 1953 : 105-106 .
L11 . S36
Those subversive foundations . School and society (Lancaster, Pa .), v..
74, Oct . 1951 : 91-92 . L11 .S36
Xeatley, V . B . They work to give millions away. Coronet (New York), v . 30, .
Oct. 1951 : 133-136. AP2. C767
Keppel, Frederick P . Opportunities and dangers of educational foundations_
School and society (New York), v. 22, Dec. 26, 1925 : 793-799 L11 .S36
. Philanthropic foundations . Science (Washington), n . c., v. 92, Dec . 26,
1940 : 581-583 . Q1 .835
Laprade, William T . Funds and foundations : a neglected phase . American
Association of University Professors bulletin (Washington), v . 38, Winter
1952-53 : 559-576. LB2301 .A3
1Lasser, J. K. Why do so many businessmen start foundations? Dun's review
(New York), Feb. 1949 : 15-17, 35+ HF1 .D8
and W. J . Casey . The family foundation . Dun's review (New York),
Aug. 1951 : 22-23+ HF1 .D8
Latcham, Franklin C . Charitable organizations and federal taxation . Western
Reserve law review (Cleveland), v . 3, Dec . 1951 : 99-138 . Law library
Private charitable foundations : income tax and policy implications .
University of Pennsylvania law review (Philadelphia), April 1950 : 617-653.
Law library
Lucas, Scott W. Income-tax deductions for donations to allegedly subversive
groups. Congressional record (Washington), 80th Cong ., 2d sess., v. 94
A826-827 . J11 .115 v. 94
Lundborg, Louis B . American business and the independent college : the future
supply of human resources . Vital speeches (Washington), v. 19, May 1, 1953
445-448 . PN6121 .V5
McDaniel, Joseph M . The Ford Foundation . Fortnightly (London) no . 1027,
n . s., July 1952 : 47-52. AP4.F7
Melch, Holmes. Philanthrophy uninhibited : the Ford Foundation . Reporter
(New York), v . 8, Mar . 17, 1953 : 22--26 . D839 .R385
Melcher, F . G . Foundations and their support of scholarly publishing . Publish-
er's weekly (New York), v. 162, Nov . 29, 1952 : 2169 . Z1219.P98
Men of the Ford Foundation . Fortune (New York), v . 44, Dec. 1951 : 116-117.
HF5001 .F7
Mezerik, A . G . Foundation racket . New republic (New York) v . 122, Jan . 30,
1950 : 11-13 . Correction . v. 122, March 6, 1952 : 4. AP2.N624
Miller, James R . He's got to give away $25,000,000 a year . This week magazine
(New York), Sept . 2,1951 : 5, 10-11 . [Concerns Paul Hoffman] . AP2.T326
The Modern philanthropic foundation : a critique and a proposal . Yale law
journal (New Haven), Feb . 1950 : 477-509 . Law library

Moe, H. A . Power of freedom . Pacific spectator (Stanford, Cal.),, v. 5, autumn

1951 : 435-448. AP2.P176
Morphet, Edgar L. The foundation program and public school finance . State
Government (Chicago), v. 25, Sept . 1952 : 192-196, 215-16 . JK2403 .S7
Nabrit, S . M . Carnegie grants-in-aid program . Phylon (Atlanta), v . 10, no . 4,
1949 : 389-391. E185.5 .P5
Now the foundations . Nation (New York), v. 174, May 17, 1952 : 465-466.
AP2.N2
Paepoke, Walter P . The fruits of philanthropy. Saturday review (New York),
v . 36, Apr. 4, 1953 : 13-14, 66 . Z1219.S25
Patch, Buel W. Tax exempt foundations . Editorial research reports (Wash-
ington), v. 1, Jan . 5, 1949 : 3-20 . H35.E35
Peattie, Donald Culross . Grubstaking the best folks : the Guggenheim Founda-
tion's way. Survey graphic (New York), v . 28, Aug. 1939 : 508-510.
HV1 .S82
Pollard, John A. Corporation support of higher education. Harvard business
review (Boston), v . 30, Sept./Oct . 1952 : 111-126 . HF5001 .H3
Pritchett, Henry S. The use and abuse of endowments . Atlantic monthly (Bos-
ton), v . 144, Oct. 1929 : 517-524. AP2.A8
Ragan, Philip H . Industrial foundations and community progress . Harvard
business review (Boston), v. 30, Nov .-Dec. 1952 : 69-83 . HF5001 .H3
Reece, B. Carroll . Tax-exempt foundations . Statement in the House of Repre-
sentatives of the United States, Apr . 23, 1953 . Congressional Record [daily
ed.] (Washington), v. 99, Apr . 23, 1953 : 3776-3777.
Report on foundations. Higher education (Washington), v . 9, Apr . 15, 1953 :
189-191 . Government Publications Reading Room
Rockefeller, Winthrop . Philanthropy faces a change . American Mercury (New
York), v. 76, Feb. 1953 : 29-33 . AP2 .A37
The role of the foundation in education . Saturday review (New York), v. 35,
Sept . 13, 1952 : 13-14, 45 . Z1219 .S25
Rosenwald, Julius . Principles of giving . Atlantic monthly. (Boston), v . 143,
May 1929 : 599-606. AP2.A8
Ross, Milton . A primer on charitable foundations and the estate tax . Taxes
(Chicago), v . 27, Feb. 1949 : 117-123. HJ2360 .T4
Russell Sage Foundation. Social service review (Chicago), v . 23, June 1949 :
247-248. HY1.S6
Scott, Austin W . Trusts for charitable and benevolent purposes . Harvard Law
review (Cambridge), v. 58, 1945 : 548-572. Law library
Scott, Hugh. . the greatest of these is charity. Philadelphia Inquirer mag-
azine (Philadelphia), April 13, 1952 : 10-11, 47 .
Select Committee To Study Tax Exemption of Certain Foundations and Or-
ganizations . Congressional record (Washington), 82d Cong., 2d sess., v . 98 :
3491-3504.
Seybold, Geneva . Company giving through foundations. Conference Board man-
agement record (New York), v. 14, Jan. 1952 : 2-5, 35-37 HD4802.C6
Seyfert, W . 0. Role of foundation in public affairs . School review (Chicago),
v . 57, May 1949 : 251-252. L11.S55
Sides, Virginia V. National Science Foundation fellowship program . Higher
education (Washington), v. 9, Nov . 15, 1952 : 67-69.
Government Publications Reading Room
Sligh, Charles R., Jr. Industry support for our colleges-moral and financial.
Association of American Colleges bulletin (Lancaster, Pa .), v. 39, May 1953
317-28 . LB2301 .A5
Sloan, H. S . Role of the foundations in postwar planning. School and society
(Lancaster, Pa .), v. 59, March 4, 1944 : 166-167. L11 .836
Sloan experiment in applied economics . National Education Association journal
(Washington), v . 36 . Jan . 1947 : 14-17 ; v . 36, Feb. 1947 : 88-91 ; v . 36,
March 1947 : 202-205 ; v. 36, Apr . 1947 : 296-298. L11.N15
. . . So they gave the $500,000,000 away . Changing times (Washington .), Feb.
1952 : 40-42. HC101.047
Taylor, Eleanor K . The public accountability of charitable trusts and founda-
tions : historical definition of the problem in the United States . Social
service review (Chicago), v . 25, Sept . 1951 : 299-319 . HV1 .S6
Text of the Trustees of the Ford Foundation's plans to aid world welfare.
New York times, Sept. 27, 1950 : 20.
Un-tory activities probe. New republic (New York), v. 129, Aug 10, 1953 : 3.
AP2 .N624


Velie, L . How to give money away . Collier's (New York), v . 122, Dec . 25,
1948- 50+ AP2 .C65
We lch, Aolmes. Philanthropy uninhibited : the Ford Foundation . Reporter
(New York), March 17, 1953 : 22-26. D839 .R385
Widener, Alice . Who's running the Ford Foundation? American Mercury
(New York), v. 76, June 1953 : 3-7 . AP2.A37
Wiley, Alexander. News releases by American Heritage Foundation . Exten-
sion of remarks of the Hon . Alexander Wiley, of Wisconsin, in the Senate
of the United States, May 18, 1953 . Congressional record [daily ed .]
(Washington), 83d Cong ., 1st sess ., v . 99, May 18, 1953 : A2846-A2848 .
Winterich, J . Q . How science aids the golden rule . Nation's business (Wash-
ington), v. 36, Nov. 1948 : 50-52 . HF1 .N4
Wooster, J. W., Jr . Current trends and developments in the investment practices
of endowments and pension funds. Law and contemporary problems (Dur-
ham, N. C .), v. 17, winter 1952 : 162-171 . Law library
PERIODICALS PUBLISHED BY FOUNDATIONS
[This listing does not include annual reports nor monographic series]
Alfred P . Sloan Foundation, Inc .
Bulletin A . P . New York, May 1940 . H62.A1A57
Grants-in-aid authorized, publications released and financial statement .
New York, 1940 . H62.A1A58
Alma Egan Hyatt Foundation
Aethiopica : . revue philologique . New York, April 1933 . PJ9001 .A42
Egyptian religion . New York, 1933. BL2441 .A1E4
Carl Shurz Memorial Foundation
American-German review. Philadelphia, 1934 . E183 .8.G3A6
Carnegie Endowment for International Peace :
Bulletin bibliographique de documentation internationale contemporaine .
Paris, 1929 . Z7136.B936
L'Esprit international : the international mind . Paris, Jan. 1, 1927 .
JC362 .A1E8
Experience in international administration . Washington, 1943
JX1906.A29
Fortnightly summary of international events . New York . D410 .F75
International conciliation . New York, 1907 . JX1907.A8
United Nations studies . New York, 1947 . JX1977.A1U57
Carnegie Foundation for the Advancement of Teaching
Review of legal education in the United States and Canada . New York,
1926/27 . LC1141 .C3
Cranbrook Institute of Science :
Cranbrook Institute of Science newsletter . Bloomfield Hills, Mich ., 1931 .
Q11 .C955
Edward W. Hazen Foundation
The Hazen pamphlets . Haddam, Conn ., 1942(?) . AC901 .H34.
Ford Foundation
Financial statements. Detroit. AS911.F6A44
Foundation for Foreign Affairs, Washington
American perspectives : a monthly analysis . Washington, April 1947.
E744.A537
Milbank Memorial Fund
Milbank Memorial Fund quarterly. New York, 1923 . HV97 .M6A32
Rockefeller Foundation
Methods and problems of medical education . New York, 1924-1930. 17 v .
R735 .R6
Russell Sage Foundation
Social work yearbook . New York, 1929 . HV35.S6
Woodrow Wilson Foundation
United Nations news . Washington (?) . January 1946.
Periodical Reading Room

SPECIAL COMMITTEE
TO
INVESTIGATE TAX-EXEMPT FOUNDATIONS

HOUSE OF REPRESENTATIVES
H . RES. 217
STAFF REPORT NO. 1

CAPITAL VALUES AND GROWTH OF CHARITABLE
FOUNDATIONS
(Page numbers are from printed hearings)
T . M. McNiece, Assistant Director of Research
Printed for the use of the committee
UNITED STATES
GOVERNMENT PRINTING OFFICE
54607 WASHINGTON : 1954

SPECIAL COMMITTEE TO INVESTIGATE TAX-EXEMPT FOUNDATIONS

B . CARROLL REECE, Tennessee, Chairman
JESSE P . WOLCOTT, Michigan WAYNE L. HAYS, Ohio
ANGIER L. GOODWIN, Massachusetts GRACIE PFOST, Idaho
RENE A. WORMSER, General Counsel
KATHRYN CASEY, Legal Analyst
NORMAN DODD, Research Director
ARNOLD KOCH, Associate Counsel
JOHN MARSHALL, Jr ., Chief Clerk
THOMAS MCNIECE, Assistant Research Director
II
CAPITAL VALUES AND GROWTH OF CHARITABLE FOUNDATIONS

It is apparent from the Cox committee hearings and from the available litera-
ture on the subject that there is relatively little information from which the
magnitude and growth of charitable foundations can be judged .
It seems rather illogical to devote serious and extended consideration to
this complex problem without having some idea of the number, size, and char-
acteristic of these charitable organizations that must exert such a great
influence on our social and economic life.
The Russell Sage Foundation has published some excellent studies in which
the actual data available have been limited to a relatively small number
of foundations .
The Cox committee reported that it had sent questionnaires to more than
1,500 organizations. Based on the record in the files, there was a return from
approximately 70 percent of these organizations . These returns have provided
the basis for the analysis in this report .
The Internal Revenue Bureau every 4 years publishes a list of tax-exempt
organizations in the United States . In the intermediate 2-year . period a sup-
plement is published . The latest major list is revised to June 30, 1950, and
the supplement to June 30, 1952 . These are the latest lists available at the
present time and it will be some time after midyear of this year before a new
list is available . It so happens that there is quite a close agreement between
these publication dates just mentioned and the effective dates of the question-
naires from the Cox committee . A large number of them were as of December
31, 1951, and a small number at the end of some fiscal period prior to 1952 .
Analysis of this Internal Revenue Bureau list indicates that as of this
period there were approximately 38,000 tax-exempt organizations in the United
States . A sampling of the pages in an attempt to identify foundations included
in this list indicated that there may be an approximate total of 6,300 out of the
38,000 organizations that might be called foundations . We believe that we are
within close limits of accuracy if we state that there are between 6,000 and 7,000
foundations in existence as of this period .
ACCURACY OF DATA AND DERIVED ESTIMATES
It should be realized that the ensuing tabulations cannot be accurate from the
standpoint of good accounting standards . A large proportion of the small
foundations is not endowed but derives its capital from recurring contributions .
Some endowments are reported at book value and others at market value . These
must be accepted as reported . It is believed that the greater part of the total
value is based on market value . In the case of foundations with capital of $10
million and over, essentially all are endowed .
The questionnaires included in the analysis are of two types : the large and
form A as described by the Cox committee . Of the total of 952 included in the
financial summaries, 65 cover foundations with capital in excess of $10 million
and 887 of less than $10 million capital . Approximately 150 of the form A ques-
-tionnaries were excluded from the financial summaries because information on
capital, income, or both were omitted from the answers returned. These were
included, however, in the numerical growth data .
In the tabulations of capital, endowment capital and current contributory
capital are added to obtain total values .
ESTIMATED TOTAL VALUES
Data from 46 of the large foundations as included in this tabulation were cov-
ered by the large questionnaires . These are the big-name foundations and were
specifically and individually selected as such by the Cox committee . The total
values applying to this group were included without change in the grand totals.
Nineteen foundations with capital in excess of $10 million were included in
the tabulations with the 887 that are under $10 million because nearly all of
these were included with a form A questionnaire . This makes 906 question-
naires included in the form A group and these are considered to be about 15
percent of the total remaining foundations in the Bureau of Internal Revenue
list as previously mentioned .
For this reason, the actual values in this group of 906 were multiplied by 6 .66 to
arrive at a total capital value of the foundations estimated to be in the Internal
Revenue Bureau tax-exempt list . This estimate is considered to be on the
conservative side and in any event sufficiently accurate as a good indication of
growth trends and total values involved .
FINANCIAL CLASSIFICATION OF FOUNDATIONS

The financial classification of the foundations made in accordance with the
foregoing remarks is shown in table I . The first 3 columns show the actual
results derived from the questionnaires, the last 2 show the estimated total
values for each size classification listed . The values shown in the last 2
columns are 6 .66 times their respective values in the 2 prior columns except for
the 46 large ones and the resulting grand total as previously mentioned .
TABLE I
[In thousands of dollars]
Endowment classification,' Form A Number of Total en- Total Adjusted en- Adjusted
questionnaires foundation .- dowment 1 income dowment 1 income
Less than $50,000 379 6,198 5,510 41,277 36,698

$50,000 to $99,999 99 7,076 1,895 47,248 12,622
$100,000 to $249,999 125 19,348 5,389 128,885 35,889
$250,000 to $499,999 87 29,107 5,430 193,850 36,162
$500,000 to $749,999 34 20,604 3,355 137,221 22,343
$750,000 to $999 .999 30 25,365 4,133 168,933 27,526
$1,000,000 to $9,999,999 133 388,368 43,509 2,586,530 289,769
$10,000,000 and over 19 304,882 17,667 2,029,405 117,660
Total, Form A 906 800,948 86,888 5,333,319 678,669
Large questionnaires 46 2,129,746 96,062 2,129,746 96,062
Grand total 952 2,930,694 182,950 7,463,065 674,731
Total, $10,000,000 and over 65 2,434,623 113,729 4,159,141 213,722
1 "Endowment classification" includes endowments as well as contributions to nonendowed or "con .

tributory" foundations that were on hand as of end of calendar or fiscal year 1951 .
Adjusted data include total endowment and income reported on Form A questionnaires multiplied by
6 .66 because the 906 questionnaires included in the summary are estimated to be 15 percent of those included
in the tax-exempt list.
It will be noted that the estimated total capital for the foundations is
nearly $7 .5 billion and total annual income nearly $675 million . Both of these
figures will be subject to considerable variation from year to year, in part be-
cause of the proportion of "contributory" foundations in the smaller groups and
because of varying earnings between good years and bad .
The proportions or percentages of foundations, their capital and their income
in each capital classification as well as the percentage of income to capital in
each class are shown in table II .
TABLE II . Percentage distribution
Percent of Percent of Percent of Income as

Endowment classification, Form A questionnaires total adjusted adjusted percent of
number endowment income capital
Less than $50,000 39.8 0.5 5 .4 89 .2

$50,000 to $99,999 10.4 .7 1 .9 26 .7
$100,000 to $249,909 13 .2 1.7 5.3 27 .8
$250,000 to $499,999 9.1 2.6 5 .4 18 .7
$500,000 to $749,999 3.6 1 .8 3 .3 16.2
$750,000 to $999,999 3.1 2.3 4.1 16 .3
$1,000,000 to $9,999,999 14.0 34.7 43 .0 11.5
$10,000,000 and over 2.0 27.2 17 .4 5.8
Total, Form A 95.2 71.5 85 .8 10.8
Large questionnaires 4.8 28.5 14.2 4.5
Grand total 100.0 100.0 100 .0 9.0
Total, $10,000,000 and over 6.8 55.7 31 .6 6.1

It is of interest to note that the foundations of less than $50,000 capital are
shown to comprise about 40 percent of the total foundations, 0 .5 percent of the
capital and 5 .4 percent of the income with a ratio of income to capital of 89 .2
percent. These strange ratios result from the fact that these small foundations
are largely of the nonendowed or contributory type and receive frequent contri-
butions of cash from creators and friends . Since much of their income is cur-
rently expended the ratio of income to capital is very high.
At the other extreme are the large foundations of capital of $10 million and
over . These account for 7 percent of the number, 56 percent of the endowment,
and 32 percent of the income. Some cash contributions are occasionally received
by these and their ratio of income to endowment is about 5 percent .
An interesting feature of this table is that the ratio of income to capital
decreases quite steadily as the capital classification increases as would be
expected from the foregoing remarks . This decrease is evident in the last
column of table I .
The great increase in foundations created in the decade of 1940-49 is featured
by the large percentage of small foundations which in turn and as previously
stated are composed of a higher percentage of nonendowed or contributory
foundations. Based on the answers to the Cox committee questionnaires, the
following comparative figures apply
Nonendowed foundations created : Percent of total
Decade 1930-39 12.5
Decade 1940-49 27.5
CHARACTERISTIC DATA ON LARGE FOUNDATIONS
Table III which follows shows data applying to the 65 foundations whose capi-
tal is $10 million and over
TABLE III
Number of foundations 65
Original capital I $590,752,000
1951 capital s $2,434,628,000
Ratio 1951 capital to original capital 4 .1
Average annual total income, 1946 to 1951, inclusive $113,729,000
Ratio annual income to 1951 capital 4 .7
Cash on hand, 1951 $40,559,000
Cash, percent of income 35 .7
Perpetual capital life $1,120,202,000
Limited capital life $99,777,000
Conditional capital life $1,214,749,000
Percent perpetual capital life 46.0
Percent limited capital life 4.1
Percent conditional capital life 49.9
Number of corporations 46
Number of trusts 17
Number of associations 2
Number of operating foundations 19
Number of nonoperating foundations 26
Number of combination foundations 20
Average capital per foundation $37,400,000
Average income per foundation $1,740,000
1 Includes capital of endowed and nonendowed foundations .
This table calls for little comment . The slight discrepancy between the figures
of 5 .1 percent in table II and 4 .7 percent in table III for earnings as percent of
capital is explained by the larger percentage of "adjusted" earnings estimated
for the 19 large foundations included in Form A group as compared with the 46
in the large group .
As previously outlined, contributions to the nonendowed organizations are
considered as income and unexpended funds largely constitute the capital in lieu
of securities in the portfolios of endowed organizations . This results in a higher
ratio of income to capital than prevails in the endowed organizations . '
It is also of interest to note the relative proportions of foundation capital in-
cluded in the perpetual, limited and conditional life classifications .
. 12 TAX-EXEMPT FOUNDATIONS
The endowments of large foundations with definitely limited life comprise only
about 4 percent of the total endowments of this large foundation group while the
perpetual and conditional groups have 46 percent and 50 percent respectively of
the totals. There seems to be very little tendency for the trustees of the con-
ditional life group seriously to reduce their endowments. This might naturally
be expected .
The numerical data show the number of foundations created each year and
the financial data show the values of the endowments reported for 1951 for the
foundations created each year . The accumulated endowments at 1951 values are
also shown . The values just described are shown in chart I . There is no appre-
ciable increase or decrease shown in the trend of endowment values added since
1900. The trend is essentially horizontal for these large foundations .
GROWTH OF LARGE FOUNDATIONS
The rate of growth both numerically and in capital values of these large
foundations during the last 50 years is shown in table IV .
TABLE IV . Foundations with capital $10 million and over (includes only those
reporting on questionnaires)
[In thousands of dollars]
1951 en- 1951 accu- Number 1951 en- 1951 accu-

Year created Number dew- mutated Year created dent mutated
created crested ment endowment
ment endowment
1900 ---------- ------------ 4 $52,911 $1,134,103

1901 ---------- ------------ 4 56,814 1,190,917
1902 ---------- ------------ 1 30.239 1,221,156
1903 ---------- ------------ 1 11,699 1,232,855
1904 ---------- 1930 4 125,369 1,358,224
1905 1 $11,769 ------------ 1931 1 12,000 1,370,224
1906 1 10,856 $22,625 932 1 15,605 1,385,829
1907 1 16,376 39,001 933 0 ----------- 1,385,829
1908 1 13,173 52,174 934 3 54,383 1,440,212
1909 2 26,662 78,836 935 0 ---------- 1,440,212
1910 0 ---------- 78,836 936 4 548,409 1,988,621
1911 1 160,897 239,733 937 2 66,981 2,055,602
1912 1 10,545 250,278 938 2 57,292 2,112,894
1913 2 335,126 585,404 1939 0 ---------- 2,112,894
1914 1 17,118 602,522 1940 2 29,334 2,142,228
1915 0 ---------- 602,522 1941 3 55,120 2,197,348
1916 0 ---------- 602,522 1942 0 ---------- 2,197,348
1917 2 28,391 630,913 1943 0 ---------- 2,197,348
1918 1 81,170 712,083 1944 0 ---------- 2,197,348
1919 1 44,762 756,845 1945 2 27,291 2,224,639
1920 1 16,673 773,518 1946 1 14,080 2,238,719
1921 1 13,703 787,221 1947 1 14,507 2,253,226
1922 0 ---------- 787,221 1948-_
-- 3 154,387 2,407,613
1023 3 41,868 829,089 1949 1 16,817 2,424,430
1924 2 210,418 1,039,507 1950 0 ---------- 2,424,430
1925 2 41,685 1,081,192 1951 1 10,300 2,434,730
Total 65 ---------- 2,434,730
The influence of some of the large foundations of 1951, but shown in the year
of their origin, is apparent on the chart . These are shown in the following
table
TABLE V
Foundation Year Original 1951

founded endowment endowment
Million
Carnegie Corp 1911 $25,000 $161
Rockefeller 1913 100,000 323
Co mm onwealth 1918 10,000 81
Kresge 1924 1,300 79
Duke 1924 40,000 131
Kellogg 1930 22,000 51
Ford ` 1936 25,000 503
Hayden 1937 17,000 52
Pew 1948 46,000 105
CHART 1 • _
..
WI-
z, . . ~.
VA
I
17
.. 11
NUMERICAL GROWTH OF 1,097 FOUNDATIONS

The Cox Committee files contained about 1,100 questionnaires . We have
classified these numerically according to the year of their origin . The numerical
growth of these regardless of type or size is shown for each year since 1900 and
the accumulated increase year by year in table VI . These data are also shown
in graphic form on chart II. The numerical-growth trend shown in table VI and
on chart II is of course confined to the Cox Committee list . It should be reason-
ably indicative of the growth trend of the whole group of foundations on the tax-
exempt list .
TABLE VI
Accumu- Accumu-
Number lated Number lated
number number
Prior to 1900 9 ---------- 1926 7 102

1900 0 9 1927 14 116
1901 0 9 1928 10 126
1902 0 9 1929 20 146
1903 1 10 1930 10 156
1904 0 10 1931 6 162
1905 1 11 1932 9 171
1906 1 12 1933 2 173
1907 1 13 1934 7 180
1908 3 16 1935 10 190
1909 3 19 1936 14 204
1910 1 20 1937 17 221
1911 3 23 1938 20 241
1912 3 26 1939 16 257
1913 2 28 1940 25 282
1914 2 30 1941 30 312
1915 5 35 1942 27 339
1916 3 38 1943 76 415
1917 4 42 1944 123 538
1918 6 48 1945 206 744
1919 7 55 1946 116 860
1920 4 59 1947 132 992
1921 6 65 1948 70 1,062
1922 4 69 1949 24 1,086
1923 11 80 1950 8 1,094
1924 7 87 1951 3 1,097
1925 8 95
The high peak centering in 1945 is composed preponderantly of the smaller

foundations and is apparently a byproduct of a change in the tax laws and of
a profitable period in the American economy . Due to the sharp decline from
1945, the trend of the accumulated increase curve has flattened considerably since
1948.

CHART 2 .
a1p - RATE 0/NUMERICAL GROWTH

r-
1097-FO NUDATIONS
IC- 9so
gC - 11
goo
ANNUAL INCREASE ; 1
an
1 eoo
1
70
700
k I
I ` 60
4
1 I11 600
1C 1 W ft
1 H
1 Q
00
1 Z
c
H
1
Q
1
0 1 R
V
Z 1 1 j
Q
2 ACCUMULATED INCREASE ;
Z 1 1 1 so
1
I ` 1
I
so
a too
I1
jb
1900 19or 1910 1915 _ 1970 92

16 TAX-ENEMPT FOUNDATIONS
Comparative data on cash and income, supplement to capital values and growth
of charitable foundations
Average
Cash, income,
Founded Average
income, Cash, percent of ercentof
in- 1946-51 1951 average 1951
income endow-
ment
Thou- Thou-
sands sands
Altman Foundation 1913 $498 $825 165.0 4.0
M . D . Anderson Foundation 1936 1,231 424 34.0 5.4
Avalon Foundation 1940 687 470 6.9 3.9
Hall Brothers Foundation 1926 232 975 420.0 3.7
Louis D . Beaumont Foundation 1949 701 416 59.0 4.2
Buhl Foundation 1927 581 315 54.0 4.4
Carnegie Corp . of New York 1911 5,941 425 7.0 3 .7
Carnegie Endowment for International Peace 1910 646 117 18.0 4.7
Carnegie Foundation for Advancement of teaching__ 1906 1,698 ________ _ ________ _ 15.6
Carnegie Institution 1926 989 109 11.0 9.2
A . C . Carter Foundation 1945 1,734 570 33.0 14.4
Cullen Foundation 1947 1,171 760 65.0 22.2
The Commonwealth Fund 1918 1,996 1,235 62.0 2.4
Danforth Foundation 1927 865 23 26.2 7.8
Donner Foundation 1945 697 403 57.9 4.6
Duke Endowment 1924 4,913 816 17.0 3.7
El Pomar Foundation 1937 507 169 33 .0 3 .5
Maurice and Laura Falk Foundation 1929 417 226 54.0 3 .6
Samuel S . Fels Fund 1936 248 332 134.0 2.1
The Field Foundation 1940 696 449 64.0 5.9
Max C . Fleischman Foundation 1951 9 1 11 .0 .1
Ford Foundation 1936 29,061 2,580 9 .0 5 .8
Henry Clay Frick Educational Commission 1909 62 307 495 .0 2 .6
Firestone Foundation 1947 57 1,575 2,765 .0 2.2
General Education Board 1903 520 788 152 .0 10 .5
Edwin Gould Foundation for Children 1923 315 241 76 .4 2.9
J. Simon Guggenheim Foundation 1925 1,083 461 43 .0 3 .6
Solomon R. Guggenheim Foundation 1937 108 84 73.0 2 .7
John A . Hartford Foundation 1929 88 702 798 .0 5 .8
Charles Hayden Foundation 1937 1,746 800 46 .0 3 .3
Louis and Maud Hill Family Foundation 1934 334 2.7
Higgins Scientific Trust 1948 1,000 (2) (7) 9
Houston Endowment 1937 1,622 435 27.0 52 .5
Godfrey M . Hyams Trust 1921 601 480 80 .0 4.4
Institute for Advanced Study 1930 687 374 41 .5 3 .5
James Foundation of New York 1941 2,130 3,388 159.0 6.8
Juilliard Musical Foundation 1920 519 390 75.0 3 .1
Henry J . Kaiser Family Foundation 1948 13 83 639.0 .1
W . K. Kellogg Foundation 1930 3 253 356 11 .0 6 .4
KresgeFoundation 1924 4,776 1,094 24 .0 6.0
Kate Macy Ladd Fund 1946 440 249 57.0 3.1
E . D . Libbey Trust 1925 565 51 9 .0 3 .6
Lilly Endowment 1937 1,462 826 56 .0 5.4
John and Mary Markle Foundation 1927 728 2 0 .3 4 .2
Josiah Macy Foundation 1930 378 65 17.0 1 .9
A. W. Mellon Educational and Charitable Trust____ 1930 1,763 644 37.0 5.2
Mellon Institute of Industrial Research 1927 3,568 274 7.7 23.7
R . K. Mellon Foundation 1947 482 250 51 .8 3.3
Millbank Memorial Fund 1905 601 841 140 .0 5 .2
William H. Minor Foundation 1923 1,052 87 8 .0 8 .4
Charles Stewart Mott Foundation 1926 420 1,552 370.0 2.9
William Rockhill Nelson Trust 1926 633 77 12.0 5.3
New York Foundation 1909 465 719 154.0 3.6
Old Dominion Foundation 1941 669 301 45 .0 5.0
Olin Foundation 1938 978 2,650 271 .0 3.2
Permanent Charity Fund 1917 367 181 49.3 3.6
Pew Memorial Foundation 1948 4,125 487 12.0 3.9
Z . S . Reynolds Foundation 1936 376 9 2.5 3.3
RockefellerFoundation 1913 11,364 6,535 58.0 3.5
Rosenberg Foundation 1935 196 424 216.0 2.7
Sarah Mellon Scaife Foundation 1941 200 1 0.6 1.9
Russell Sage Foundation 1907 542 381 70.0 3.3
Alfred P . Sloan Foundation 1934 1,329 1,747 132.0 4.5
Surdna Foundation 1917 756 558 74.0 4.2
Twentieth Century 1919 457' 657 144.0 4.6
Estate of Harry C . Trexler 1934 433 242 558.0 3.4
William C . Whitney Foundation 1936 75 10 13.0 5.0
William VolkerCharities 1932 1,027 1,032 100.0 6.6
It is believed that the data portrayed in this report, while not of provable
accuracy, are sufficiently representative of actual conditions to provide reason-
able guidance in appraising the magnitude of the problems involved . This
should assist in the consideration of any suggestions that may seem advisable for
possible legislative action .
T. M. MoNracel.
0

SPECIAL COMMITTEE
TO

H. RES. 217
STAFF REPORT NO. 2

RELATIONS BETWEEN FOUNDATIONS AND
EDUCATION AND BETWEEN FOUNDATIONS
AND GOVERNMENT
May 1954
UNITED STATES

SPECIAL COMMITTEE TO INVESTIGATE TAX-EX] MPT FOUNDATIONS :

B. CARROLL REECE, Tennessee, Chairman
ANGIER L . GOODWIN, Massachusetts GRACIE PFOST, Idaho
RENE A. WORMSER, General Counsel .'. . .
JOHN MARSHALL, Jr ., Chief Clerk
THOMAS MCNIECE, Assistant Research Director
11

STATEMENT OF THOMAS M. McNIECE, . A:S TANT RESEARCH

DIRECTOR, SPECIAL COMMITTEE TO INVESTIGATE TAX-EXEMPT
FOUNDATIONS
PRErATORX( STATEMEtf .
Mr. McNscE. From the jungle of semantics various people may de=
rive different interpretations from thesAme statement . In the simplest
terms possible, we wish to'say that in this report,, regardless of other
interpretations, we intend to draw no conclusions but rather to portray
such available facts as we have been able to gather on this complex
subject., This report covers but one phase of the larger work that is
being done .
Furthermore, we are not criticizing change as such. Rather does
the evidence which will be offered seem to show thatt the=,pattern is
one of evolving collectivism, the ultimate aim of several varieties o
political thought with different names and a common objective.
To explain our reference to a common objective we wish to quote
from the sources indicated a number of statements- on this subject .
Report of the Joint Le 'slative Committee Investigating Seditious
Activities, filed in 'New ork State' 1920 , I, believe that was known
as the Lusk committee. "
In the report here presented the committee seeks to give a clear, : unbiased
statement and history of the purposes and objects, tactics and methods, of the
various forces now at work in the United States . . which are. seeking to under-
mine and . destroy, not only the government under which we live, but also the
very structure of American society ;
. , In the section of this report dealing with American conditions, the com-
mittee has attempted to describe in detail the various organizations masquerad-
ing as political parties, giving the principles and objects, for which they stand,
as well as methods and tactics they employ in order to bring about the social
revolution.
In every instance the committee has relied upon the so-called party or organ
ization's own statements with respect to these matters :.
Those (organizations) representing the Socialist-point of view are the Socialist
Party of America, the Communist Party of America, the,Qommunist Labor Party,
and the Socialist Labor Party . Each of these groups" claim to be the most
modern and aggressive body representing Marxian theories .
A study of, their platforms and official pronouncements, shows that they do
not differ fundamentally in their objectives
These organizations differ but slightly in the means advocated to bring
about the social revolution : . . they differ slightly in the matter of em-
phasis . . .
League for Industrial Democracy : Definition of 'Democracy", New
Frontiers, Vol . IV, No. 4, June 1936
The fight for democracy is at one and the same time also a fight for, socialism,
democracy, to be sure, rests on liberty, but its substance is equality .
But finally, equality is social equality . All political institutions of- democracy
are perverted by private property in the means of production. Personal, legal,
political equality-they, all can be fully realized only when private property
is abolished, when men have an equal control over ptbpertyt
Democratic Socialism by Roger Payne and George''W. Hartman,
1948, page 77 .
467

These men are English authors .

In the socialist society of the future there will be two things in which it will
be fundamentally different from the present society . One of these is collective
ownership of the means of production and distribution ; the other is a complete
democracy under which the political, economic, social and international life
will be complete democratized .
,The-Socialist
. Call (officiall organ of the Socialist Party), April
1954, page 5 ~
Socialists regard the capitalist system of private property 'relations,
with its complex, disputable, sometimes unfathomable inner economic laws and
relationships, as a wall that stands between humanity and its goals in economic
affairs, between man .and, his bread and-peace of mind .
THE INTRODUCTION
Oil page A1161 of the, appendix of the Congressional Record of
February-16, 1954 there appears the copy of an article by Seymour
E. Harris, professor of economics at Harvard University. This arti-
cle is entitled, "The Old Deal," and appeared originally in the maga-
zine Progressive' 7n the' issue of December 1953 . We are quoting the
first paragraph of this article
In the 20 years ,between 1933, . and 1953 the politicians, college professors,
and lawyers,. with` a little . help from business, wrought' a revolution in the
economic policies of the United States . They repudiated laissez-faire . They
saw the simple fact that if capitalism were to survive, Government must take
some responsibility for developing the Nation's resources, putting a floor under
spending, achieving, a more equitable distribution of income, and protecting the
weak against the , strong . The' price of continuing the free society was to be
limited intervention by Government .
Stepping backward for a span of 9 years, we wish to submit
another quotation, this time from the issue of October 15, 1943, of
the m agazine Frontiers' of ,Democracy, the successor to an earlier
one to which reference will be made later and which was called "Social
Frontier," Dr . Harold Rugg of Teachers College, Columbia Univer-
sity,''was the editor of the latter magazine and the author of the
article from which this excerpt is made .
Thirteen months will elapse between the publication of this issue of Frontiers
and the national election- of ,1944 . In those months the American people must
make one of the great,decisions in their history . They will elect the President
and the Congress that will make the peace and that will carry on the national
productive system 'in the transition years . The decisions made by that Gov-
ernment, in collaboration with the British and Russian Governments, will set
the mold of, political and economic life for a generation to come . * * * We have
suddenly come out upon a new frontier and must chart a new course . It is
a psychological frontier, an unmarked wilderness of competing desires and
possessions, of`propertyownerships and power complexes . On such a frontier
wisdom is the supreme need, rather than technological efficiency and physical
strength in which our people are so competent.
We are strong enough but are we wise enough? We shall soon see for the
testing moment is now . Our"measure will be' taken in these 13 months . The
test is whether enough of our people-perhaps a compact minority of 10 million
will be enough--can grasp the established fact that, in company with other
industrializing peoples, we are living in a worldwide social revolution .
We propose 'to. offer evidence which seems to indicate that this
"revolution" has. been promoted . Included within this supporting
evidence will be documented, records that will show how the flow of
money, men, and ideas combined to promote this so-called revolution
just mentioned.

'tÀX-EXEMPT 1 O0UNDA'kONS 469
The money in large part came from the foundations . Men and
ideas in a great measure came from the intellectual groups or so-
cieties supported by this money and found their way into the power-
ful agencies of education and Government . Here in these pivotal
centers were combined the professors, the politicians, and the lawyers
mentioned a moment ago .
Foundations, education, and Government form a triangle of influ-
ences, natural under the circumstances and certainly without criti-
cism in itself as long as the three entities exist and the liaison is
not abused or misused in the furtherance of questionable activities .
THE ORGANIZATION CHART
The nature of these threefold relationships can be most clearly and
q uickly illustrated by reference to the chart prepared for the pur-
pose and entitled, "Relationships Between Foundations, Education,
and Government." Let it be emphasized again that there is no ele-
ment of criticism or condemnation to be inferred from this chart . It
is what is commonly considered as a functional organization chart,
and its purpose is to display graphically what it is difficult to describe,
to see and to understand by verbal description only.
As previously suggested, the chart is basically in the form of a
triangle with appended rectangles to indicate the functional activi-
ties in their relationship to each other . At the apex we have placed
the foundations . At the lateral or base angles, on the left and right,
respectively, are the educational and governmental members of the
triad . Suspended from the rectangle representing the foundations
are those representing the intellectual groups which are dependent
to a large extent upon the foundations for their support .
The relationships between and among these organized intellectual
groups are far more complex than is indicated on the chart . Some
of these organizations have many constituent member groups . The
American Council of Learned Societies has 24 constituent societies,
the Social Science Research Council 7, the American Council on
Education 79 constituent members, 64 associate members, and 954
institutional members . In numbers and interlocking combinations
they are too numerous and complex to picture on this art.
Mr. Kocx . May I suggest that this chart he refers to should be
deemed in evidence and part of the record?
The CHAIRMAN. I so understood.
Mr. Kocx . Go ahead .
Mr. HAYS . Where will it be inserted, not that it makes any differ-
ence. Will it be at the end of his statement or at the middle?
Mr. KOCH . I should think right here where he is talking about it .
The CHAIRMAN . Under the caption "Organization Chart ."
Mr . McNIECE. I would think that would be the natural place for it .
Mr. KocH . Go ahead .
Mr. McNIECE . These types of intellectual societies may be con-
sidered as clearing houses or perhaps as wholesalers of money received
from foundations inasmuch as they are frequently the recipients of
relatively large grants which they often distribute in subdivided
amounts to member groups and individuals.
For illustrative purposes, the following four societies are listed
American Council of Learned Societies, including the American His

INTER-RELATIONSHIPS BETWEEN 0
FOUNDATIONS, EDUCATIONAND GOVERNMENT
FOUNDATIONS
AMERICAN COUNCIL
OF LEARNED SOCIETIES_
AMERICAN HISTORICAL -
ASSOCIATION
SOCIAL SCIENCE
RESEARCH COUNCIL
NATIONAL ACADEMY
OF SCIENCES
AMERICAN COUNCIL
ON EDUCATION
B
EDUCATION FEDERAL GOVERNMENT
OFFICE OF EDUCATION
0 P
NATIONAL STATE SOCIAL
ADULT MILITARY
UNIVERSITIES EDUCATION
EDUCATION DEPARTMENT PLANNING
ASSOCIATION 03
GRANTS ADULT EDUCATION S RESEARCH : NATIONAL EDUCATION
FELLOWSHIPS ECONOMIC PLANNING BOARD PSYCHOLOGICAL
ASSOCIATION WARFARE
BIOGRAPHIC 1933-34
DID
SOCIAL SCIENCES NATIONAL RESOURCES
INTERNATIONAL AREAS PLANNING BOARD
1939-43
T U I
PRIMARY SECONDARY EDUCATION INTERNATIONALISM

CHARITIES MILITARY
SCHOOLS SCHOOLS
MEDICINE AND HEALTH FINANCE
NUTRITION COMMERCE
EMPLOYMENT AGRICULTURE
SOCIAL SECURITY INDUSTRIAL PRODUCTION
SOURCE House of Representatives . RECREATION
SOCIAL SCIENCES
NATURAL RESOURCES
PUBLIC WORKS
Special Committee to Investigate
Tax Exempt Foundations. NATURAL SCIENCES HOUSING
May 1954

TAX-=9MPT . FOUNDATIONS 471
torical Association, Social Science Research Council, National . Atad-

emy, :of Sciences, American Council on Education.
The four shown on the chart are enough to; illustrate the relation-
ship of such societies to the governmental and the other odWational
units shown- on the chart. Furthermore, credit or , appreciation has
been expressed by both educational and governmental circles for aid
received from each of these four organizations .
Below the rectangle representing education appear the various
branches of the educational effort.; To avoid undue complexity, no
attempt has been made here or at any other points on the chart to
portray any but the principal areas of operation . Under the govern-
mental function a few divisions of activity are shown . These are con-
fined to the executive branches . of Government where the greatest
changes have occurred .
INTERPRETATION OF THE CHART
The lines connectingg the various rectangles on the chart • symbolize
the paths followed in the flow or interchange of money, men, and ideas
as previously mentioned . The focal point of contacts between these
connecting lines and the rectangles are lettered somewhat in the man-
ner used in textbooks of geometry and trigonometry in order to facili-
tate identification and reference in describing the existing relation-
ships. Finally, this chart as a whole will be useful in locating the
areas in which we have found evidence of questionable procedure
against what we deem to be public interest .
Leaving the chart for a few moments, we shall refer to certain
information derived from the record of the Cox committee hearing .
INFORMATION FROM THE COX COMMITTEE HEARING
Reference to the record shows that definite orders were issued in
Soviet circles to infiltrate "all strata of western public opinion" in
an effort to accomplish two objectives : one, to penetrate and utilize
intellectual circles for the benefit of the Soviet cause and two, to
gain access to foundation funds to cover the cost of such effort . Tes-
timony of Messrs. Bogolepov and Malkin described firsthand knowl-
edge of these instructions . Testimony of Mr . Louis Budenz confirmed
this, even to listing the names of committee members appointed to
accomplish this objective . Testimony of Mr . Manning Johnson added
further confirmation of these facts and in addition provided the
names of certain individuals who had succeeeded in penetrating or
receiving grants from several of the foundations .
Evidence of actual Communist entry into foundation organiza-
tions is supplied in the Cox committee record . This testimony in-
volves at least seven -foundations, namely, the Marshall Field
Foundation, the Garland Fund, the John Simon Guggenheim Founda-
tion, the Heckscher Foundation, the Robert Marshall Foundation,
the Rosenwald Fund, and the Phelps Stokes Fund .
Mr. HAYS . Could I interrupt there?

'VAX-EXEMPT ftUX0ATfbX8
412
Mr . McNIECE . Certainly .
Mr . HAYS. I don't want to make a habit of this, because I agreed'
not to. I want to know if those are the only foundations that the
staff found any evidence of Communist infiltration?
Mr . MCNIECE. That is the only ones I found . I may have over-
looked some in the mass, but it was not intentional .
Mr. HAYS. In other words, you did not find any in the Big Four
or Big Three?
Mr. McNIECE . No . I think there was some varying testimony on
that which will come out later .
The tax-exempt status of the Robert Marshall Foundation was
revoked by the Internal Revenue Bureau and the Rosenwald Fund,
which was one of limited life, was liquidated in 1948 in accordance
with the date specified by the founder .
Reference to the Cox committee record shows that some 95 indi-
viduals and organizations with leftist records or affiliations admittedly
received grants from some of our foundations . These were divided
as follows
Rockefeller Foundation, 26
Carnegie Corporation, 35
Russell Sage Foundation, 1
Wm . C. Whitney Foundation, 7
Marshall Field Foundation, 6
John Simon Guggenheim Foundation, 5
Carnegie Endowment for International Peace, 15
A total of 95 .
It should be clearly understood that there is no significance to . be
attached to the numerical differences or comparisons in the foregong
list. There are too many variables involved to warrant any conclusions
whatever on relative performance among the foundations listed .
Among these are the differing number of grants made and the varying
portunities for thorough search or screening of the records involved .
This list does not include all the grants of this character that were
op
made. At this time we are not concerned with the question as to

whether or not the foundations knew or could have found out about the
questionable affiliations of these grantees before the grants were made .
The fact is, the funds were given to these people . This is the impor-
tant point of interest to us . These grants were made to professors,
authors, lecturers, educational groups, and so forth, and all virtually
without exception were included within educational circles . It should
be obvious that with the passage of time, the activity of this many
people and organizations dedicated to spreading the word in the edu=
cational field, would have an influence all out of measurable propor-
tion to the relative value and number of grants . This influence is
increasing and will continue to increase unless it is checked .
PERSONNEL AND ADVISORY SERVICES FROM HIGH LEVEL

During the last 20 years and especially in the last decade, the Gov .
ernment has made increasing demands upon the educational world for
assistance from academic groups or societies . As will be brought out
later in the documented records, it is from these centralized and inter-
locking educational groups that much of the influence which we ques-
tion has arisen .

To indicate the magnitude of-these sources of influence a-few matters

of record may be mentioned.
The National Planning Board requested aid from the Social Science
Research Council in compiling a section of one of their planning
reports. A committee from the Social Science Research Council ac-
tually prepared this section of the report . The creation of this com-
mittee for the purpose is described in the annual report for the Social
Science Research Council for 1933-34 . The National Planning Board
rendered a final report for 1933-34 . On page 54 of this report is the
follow ing caption : "The Aid Which the Social Sciences Have Ren-
dered and Can Render to National Planning, June 1934 ."
Immediately below this is the phrase
Memorandum prepared for the National Planning Board by a committee of the
Social Science Research Council .
In 1950, the Russell Sag Foundation published a booklet entitled,
"Effective Use of Social Science Research in the Federal Services ."
On page 5 of this report is the following statement to which we have
added some italic
This pamphlet has been written because the Federal Government has become
the outstanding employer of social scientists and consumer of social science mate-
rials in the conduct of practical affairs. Expenditures of the Federal Government
for social science research projects, either under direct governmental auspices or
under contract with private agencies, and for personnel in administative capaci-
ties having command of social science knowledge, far exceed the amount given
by all the philanthropic foundations for similar purposes .
Further evidence of the importance placed on this source of aid
in governmental operations is offered in the following extracts from
the annual reports of the Rockefeller Foundation wherein they refer
to the granting of a total of $65,000 to facilitate planning for adequate
supply of personnel qualified for "high level work" in public affairs
and education .
On page 313 of the 1949 annual report, the following statement
appears : .
American council of Learned Societies Personnel in Humanities. Careful
planning to assure a steady supply of people qualified for high-level work is
needed in public affairs as well as in education and institutional research . Con-
siderations of national welfare have led a number of governmental agencies
to ask how many specialists of particular kinds now exist, how they can . be
located and whether they are now being replaced or increased in number
Another reference appears on page 412 of the annual report for
1951 . It follows herewith
American Council of Learned Societies-Personnel in the Humanities . Dur-
ing the last several years extensivee studies have been made of the demands for
and the possible supply in the United States of personnel with unusual academic
training . Because of the importance of having the humanities adequately rep-
resented in such studies, the Rockefeller Foundation in 1949 made a grant of
$31,000 to the American Council of Learned Societies to permit the addition
to its staff of Mr . J . F . Wellemeyer, Jr ., as staff adviser on personnel studies .
In view of the effective work done by the staff adviser, the Rockefeller Foun-
dation in 1951 made an additional 2-year grant of $34,000 for continuation of
this activity.
In the foregoing record from the annual report of the Rockefeller
Foundation for 1949 is the very clear statement of the need for an
adequate supply of personnel sufficiently qualified in the humanities
for public affairs, education and institutional research . In itself
54608-54-2
there should be no criticism of this objective. It does, however, seem

to confirm that much of the influence which we are discussing comes
from highly centralized sources. This naturally increases the - oppor-
tunity to effectuate highly , coordinated plans in all affected areas - of
activities and functions . Any criticism that arises should be directed
to the final product or end result of this liaison . If such end results
are harmful or opposed to the public interest all who have partici-
pated in the development of the situation should share the responsi-
bility, and especially if such activities and their support are continued .
Inasmuch as the term "public interest" will be used in this report
from time to time, it will be well to define it in the sense that it is
used in this section of the report of the staff committee . The same
conception of the public interest is used in the economic section -of
the staff's report . Public interest is difficult- to define 'but for the
purpose of this study, we can probably do no better than to referr to
the preamble of the Constitution of the United States wherein'_ it
is stated that the Constitution is established-
in order to form a more perfect union, establish justice, insure domestic tran-
quility, provide for the common defense, promote the general welfare, and
secure the blessings of liberty to ourselves and our posterity .
Mr. HAYS . Mr. McNiece, right there, maybe we ought to mark that
passage, because I think the `promote the general welfare" clause is
going to be a pretty debatable thing when we get into it .
Mr. McNrECE. I think so.
Mr. HAYS You don't have a staff definition of that?
Mr. McNIECE. Of public welfare?
Mr. HAYS . Of general welfare.
Mr. McNIECE. I think it encompasses a great many activities which
will come out later perhaps outside the pale of enumerated powers .
The last three words in the foregoing quotation impose a respon-
sibility for the future upon us of the present . Later, as we approach
the lower right-hand angle, we will have occasion to introduce for-
mally the report on economics and the public interest . It will be tied
up especially with the rectangle indicated as "social planning ."
We would now like to offer the supplement, which is very brief,
entitled, "Supplement to the Initial Staff Report on Relationship
Between Foundations and Education ."
The ensuing financial data will give some idea of the great amount
of funds and their distribution made available in the educational field
by a few of the larger foundations .
The statement is by no means complete . In fact it contains the con-
tributions of only six of the larger foundations where the specific bene-
ficiaries are named .
These six are as follows
The Carnegie Corporation of New York
The Carnegie Endowment for International Peace .
The Carnegie Foundation for the Advancement of Teaching
The Rockefeller Foundation
The General Education Board
The Ford Foundation (two instances only)
Great benefit has unquestionably resulted to all mankind from the
contributions of these and other foundations and there is no inten-
tion to gainsay or minimize this or to detract from the credit due
the foundations for these benefits.

TAX-EXEMPT- FOUNDATIONS 475
What this- :investigation does seem to indicate is that, many small

grants have found their way into questionable hands and many large
ones in points of concentrated use have been devoted to purposes that
are promoting a departure from .the fundamental concepts of edu-
cation and government _ under our Constitution. That this may be
recognized' by those engaged in such activities is indicated by the
frequent references in their own literature to the "age of transition"
through which we are passing, and the responsibility that must be
assumed by educators in leading the way . No one in full possession
of his faculties should oppose change for the better but change for the
sake of change alone may prove to be a dangerous delusion.
The following record has been summarized from the annual reports
of the foundations previously named
Associations receiving grants Period Amount
American Council on Education 1920-52 $6,119,700

American Historical Association 1923-52 574,800
American Council of Learned Societies 1924-52 5,113,800
Council on Foreign Relations 1923-52 3,064,800
Foreign Policy Association 1933-51 1,938, 000
Institute of International Education 1929-52 2, 081,100
Institute of Pacific Relations 1929-52 3, 843,600
National Academy of Sciences (including National Research Council) 1915-52 20,715,800
NationalEducation Association 1916-52 1,229,000
Progressive Education Association 1932-43 4,257,800
Social Science Research Council 1925-52 11, 747, 600
Total ------------ 60,686, 000
NOTE.-The foregoing grants follow the lines AD, thence CB on the chart .
Specific university grants Period Amount
London School of Economics 1929-52 $4,105,605

Teachers College-Columbia University 1923-52 8,398,175
Lincoln School-Columbia University 1917-52 6,821,100
NOTE.-The foregoing grants follow the line AB on chart .
Grants by the Rockefeller Foundation (derived from a consolidated

report of the Rockefeller Foundations) and the General Education
Board combined to universities and including only the totals to the
ten largest beneficiaries of each of the two foundations in each State
of the United States
Period Amount
To universities 1902-51 $256,553,493

Totalfellowship grants 1902-51 33, 789, 569
Total 290,343, 026
According to our compilations, the Carnegie Corp . has contributed

to all educational purposes, from 1911 to 1950, approximately
$25,300,000 .
(These grants follow the line AB on the chart.)
These data are representative of the conditions which they disclose.
It has been difficult to assemble these figures in the manner shown in

476 TAX,-EXDM T FOUNDATIONS
the time available. If there are any errors in the compilation, we

firmly believe that they minimize the contributions .
A PRODUCT OF FOUNDATION SUPPORT
On the organization chart previously discussed, the American

Council of Learned Societies is the first group listed under the "Clear-
House" designation. One of the constituent societies of this
Council is the American Historical Society and it is separately shown
as such because it has a most prominent role in our investigation .
Under this association was formed a Commission on Social Studies .
Its plans and objectives can be most fairly stated by quoting from
the official report of the association . The following statement ap-
pears on page 47 of the annual report of this association :
The study advocated is to comprise a collection of general statistical infor-
mation, the determination of specific objectives, the organization of content, in
the light of these objectives for teaching purposes, the methods of instruction
and testing and of the preparation of teachers . An extensive personnel and
5 years of work were required by this plan . Means for its execution are
now being sought .
The idea just expressed originated in a report in 1926 by a Com-
mittee of History and Other Studies in the Schools .
The "means" for the execution of the plan were supplied by the
Carnegie Corp. In a series of six annual grants extending from 1928
to 1933, inclusive, this foundation supplied a total sum of $340,000
to the American Historical Association for the use of the Commis-
sion on Social Studies formed to carry out the recommendations of
the Committee on History and Other Studies in the Schools .
As finally completed, the report of this committee was published in
16 separate sections . The 16th and final volume of the report was
published by Scribners in May 1934 . It is entitled, "Report of the
Commission on the Social Studies-Conclusions and Recommenda-
tions of the Commission."
It is with this final volume of conclusions and recommendations that
the staff committee is concerned . It covers a tremendous field of
recommendation and application actively in process as of this day .
Support for this latter statement will be introduced later .
Much of this last volume is devoted to recommendations of techni-
cal moment covering content and teaching technique . These are not
pertinent to our problem . Those which do apply to our study of
the case are quotedd hereafter under the subheadings and paragraph
numbers as they appear in the book (pp . 16-20) .
CONCLUSIONS AND RECOMMENDATIONS OF THE COMMISSION ON SOCIAL STUDIES
8 . Under the molding influence of socialized processes of living, drives of
technology and science, pressures of changing thought and policy, and disrupt-
ing impacts of social disaster there is a notable waning of the once widespread
popular faith in economic individualism ; and leaders in public affairs, supported
by a growing mass of the population, are demanding the introduction into
economy of ever wider measures of planning and control .
9 . Cumulative evidence supports the conclusion that, in the United States
as in other countries, the age of individualism and laissez faire in economy
and government is closing and that a new age of collectivism is emerging.
10 . As to the specific form which this "collectivism," this integration and inter-
dependence, is taking and will take in the future, the evidence at hand is by
no means clear' or unequivocal . It may involve the limiting or supplanting of
private property by public property or it may entail the preservation of pri-
TAX-EXEMPT
: P{VW'DATIQW$ 4,77
'bate property, extended and distributed among the masses, Most likely, it
will issue from a process of experimentation and will represent a composite
of historic doctrines and social conceptions yet to appear . Almost certainly
it will involve a larger measure of compulsory as well as voluntary coopera-
tion of citizens in the conduct of the complex national economy, a corre-
sponding enlargement of the functions of government, and an increasing state
intervention in fundamental branches of economy previously left to the indi-
vidual discretion and initiative-a state intervention that in some instances
may be direct and mandatory and in others indirect and facilitative . In any
event the commission is convinced by its interpretation of available empirical
data that the actually integrating economy of the present day is the forerun-
ner of a consciously integrated society in which individual economic actions
and individual property rights will be altered and abridged.
11 . The emerging age is particularly an age of transition . It is marked by
numerous and severe tensions arising out of the conflict between the actual trend
toward integrated economy and society, on the one side, and the traditional prac-
tices, dispositions, ideas, and institutional arrangements inherited from the pass-
ing age of individualism, on the other . In all the .recommendations that follow
the transitional character of the present epoch is recognized .
12. Underlying and illustrative of these tensions are privation in the midst of
plenty, violations of fiduciary trust, gross inequalities in income and wealth,
widespread racketeering and banditry, wasteful use of natural resources, un-
balanced distribution and organization of labor and leisure,, the harnessing of
science to individualism in business enterprise, the artificiality of political bound-
aries and divisions, the subjection of public welfare to the egoism of private
interests, the maladjustment of production and consumption,, persistent tenden-
cies toward economic instability, disproportionate growth of debt and property
claims in relation to production, deliberate destruction of goods and withdrawal
of efficiency from production, accelerating tempo of panics, crises, and depres-
sions attended by ever-wider destruction of capital and demoralization of labor,
struggles among nations for markets and raw materials leading to international
conflicts and wars.
13 . If historical knowledge is any guide, these tensions, accompanied by oscil-
lations in popular opinion, public policy, and the fortunes of the struggle for
power, will continue until some approximate adjustment is made between social
thought, social practice, and economic realities, or until society, exhausted by the
conflict and at the end of its spiritual and inventive resources, sinks back into a
more primitive order of economy and life . Such is the long-run view of social
development in general, and of American life in particular, which must form the
background for any edticational program designed to prepare either children or
adults for their coming trials, opportunities, and responsibilities.
Page 19
D. CHOICES DEEMED POSSIBLE AND DESIRABLE
1 . Within the limits of the broad trend toward social • integration the possible
forms of economic and political life are many and varied, involving wide dif-
ferences in modes of distributing wealth, income, and cultural opportunity, em-
bracing various conceptions of the State and of the rights, duties, and privileges
of the ordinary citizen, and representing the most diverse ideals concerning the
relations of sexes, classes, religions, nations, and races - * *
THE REDISTRIBUTION OF POWER
1 . If the teacher is to achieve these conditions of improved status and thus
free the school from the domination of special interests and convert it into a
truly enlightening force in society, there must be a redistribution of power in the
general conduct of education-the board of education will have to be made more
representative, the administration of the school will have to be conceived more
broadly and the teaching profession as a whole will have to organize, develop a
theory of its social function and create certain instrumentalities indispensable
to the realization of its aims .
2 . The ordinary board of education in the United States, with the exception
of the rural district board, is composed for the most part of business and pro-
fessional men ; the ordinary rural district , board is-composed almost altogether
of landholders . In the former case the board is not fully representative of the
supporting population and thus tends to impose upon the school the social ideas

448 1 iX4 T" FOUNVATIONS

of . a: special class ;'in! both instances its' membership is apt to be peculiarly rooted
in the economic individualism of the 19th century .
8 . If the board of education is to -support a school program conceived in terms
of the general - welfare and adjusted to the needs of an epoch marked by tran-
sition to some form 'of socialized economy, it should include in Itsmembership
adequate representation of points of view other than those of private business.
4. With the expansion of education and the growth of large school systems,
involving the coordination of the efforts of tens, hundreds and even thousands
of professional workers and the expenditure of vast sums of money on grounds,
buildings and equipment, the function of administration has become increas-
ingly important -and . indispensable.
Page 145
APPENDIX A-NEXT STEPS
1 . The commission has, for reasons already given, rejected the idea that there is
one unequivocal body' of subject matter, one unequivocal organization of mate-
rials, and one unequivocal method of teaching which, when combined, will guar-
antee the realization in instruction of the broad purposes set forth above . It
was not instructed to provide a detailed syllabus and set of textbooks to be
imposed on the school system of the country . Had it been so instructed it would
have found the mandate incompatible with its fundamental conclusion that the
frame of reference is the, primary consideration and that many methods of
organizing materials and teaching are possible and desirable within the accepted
frame.
2 . However, the commission is mindful of the proper and practical question
What are the next steps? It indicates, therefore, the lines along which attacks
can and will be made on the problem of applying its conclusions with respect to
instruction in the social sciences.
3. As often repeated, the first' step is to awaken and consolidate leadership
around the philosophy and purpose of education herein expounded-leadership
among administrators, teachers, boards of trustees, college and normal school
presidents-thinkers and workers in every field of education and the social'
sciences . Signs of such an awakening and consolidation of leadership • are
already abundantly evident : in the resolutions on instruction in the social
sciences adopted in 1933 by the department of superintendence of the National
Education Association at Minneapolis and by the association itself at Chicago ;
in the activities of the United States Commissioner of Education during the past
few years ; and in almost every local or national meeting of representatives of
the teaching profession .
4. The American Historical Association, in cooperation with the National
Council on the Social Studies, has arranged to take over The Historical Outlook'
(a journal for social-science teachers), has appointed a board of editors chosen
in part from the members of this commission, and has selected for the post of
managing editor, W . G . Kimmel, who has been associated with this commission
as executive secretary for 5 years and is thoroughly conversant with its work
and its conclusions . The purpose of the Outlook under the new management will
be to supply current materials, to encourage experimentation in the organization
of materials, to stimulate thought and experimentation among teachers and
schools, to report projects and results of experimentation, and generally to fur-
nish as rapidly as possible various programs of instruction organized within the
frame of reference outlined by the commission .
5 . The writers of textbooks may be expected to revamp and rewrite their old
works in accordance with this frame of reference and new writers in the field
of the social sciences will undoubtedly attack the central problem here con-
ceived, bringing varied talents and methods and arts to bear upon it . Thus
the evil effects of any stereotype may be avoided .
6 . Makers of programs in the social sciences : in cities, towns, and States
may be expected' to evaluate the findings and conclusions of this report and to
recast existing syllabi and schemes of instruction in accordance with their
judgment respecting the new situation.
7. If the findings and conclusions of this commission are really pertinent to
the educational requirements of the age, then colleges and universities offer-
ing courses of instruction for teachers will review their current programs and
provide for prospective teachers courses of instruction in general harmony with .
the commission's frame of reference . .
i Hereafter to b'e'eailed The Social Studies.
TAX-EXEMPT FOIINDATIOWS 479
8. The same may be said of special institutions for the training of teachers.
It is not too much 16 expect in the near future a decided shift, In emfi'hasis
-from the mechanics and techniques of methodology to the content sit$
func=tion
of courses in the social sciences, thus guaranteeing a' supply of teachers
more competent to carry out the philosophy and purpose here presented .'
$: A similar transfer' of emphasis , may be expected in the field"ofeeducatlonal
ournaiism, resulting in a consideration, criticism, and application of the funda-
`mental philosophy of education formulated in this volume .
1O f the present report aids in bringing about a persistent concentration
of- thought òn ,the central issues, findings, and conclusions of the commission,
it' will help 'to clear up ` the confusion ` now so prevalent in the educational
world and give direction to powers now wasted in formalistic debates on meth-
0d$' and techniques .
11. _In fine, the commission has felt bound,' by the terms of its instructions
and'the nature' of the subject entrusted to its consideration, to provide a frame
of reference for the orientation of philosophy and purpose in education, rather
than a bill' of minute specifications for guidance . In so doing, it is convinced
that unless the spirit is understood and appreciated any formulation of the
latter will hamper rather than facilitate the fulfillment of the commission's
offering .,
',.It would seem that the nature of these conclusions and recommenda-
tions is expressed with sufficient clarity and force to need no further
interpretation from us . It will be important, however, to show how
these .ideas have been put into operation and are in operation today
as far as it has proven possible of accomplishment.. It is our plan
through the - introduction of documented evidence from various
authoritative sources- to. show how these recommendations have been
4a aneled through the activities in education and government . While
the trails criss-cross and are somewhat devious we shall try as far as
is, feaasible to analyze .the trend in education first and to follow with
a similar effort in government.
Before undertaking this, it should be of interest to quote from the
record ,o show the appraisal by the Carnegie Corp . itself of the prod-
uct for which they had granted the considerable sum of $340,000 . We
find. no, word of criticism or dissent in the following statement which
appears- on page 28 of the annual report of the president and the
treasurer of the Carnegie Corp . of New York for 1933-34 .
The conclusions and recommendations of the commission on the social studies
appointed by the American Historical Association appeared in May, 1934 .
That the findings were not unanimously supported within the commission Itself,
and that they are already the subject of vigorous debate outside it, does not
detract from their importance, and both the educational world and 'the- - public
at large owe a debt of gratitude both to the association for having sponsored this
important and timely study in a field of peculiar difficulty, and to the distin-
guished men and women who served upon the commission . The complete report
of the committee will comprise 16 volumes, a list of which will be found in the
appendix, page 67 .
A somewhat different,. and more descriptive appraisal of this report
is offered by Dr. Ernest Victor Hollis, in his book entitled, "Philan-
thropic Foundations and Higher Education ." Dr. Hollis is Chief
of College Administration in the United States Office of Education,
Washington, D. C.
The following statement is quoted . from page 61 of this book
Today they (the foundations) - have a • vital part in practically every type of
progressive educational experiment under way in America. Possibly there has
been no more radical and forward-looking study of the American scene than is
presented in the sixteen-volume report of the Social Studies Commission of the
American Historical Association which was begun in 1927 and very recently
completed. The report demands a radical change in many of the major premises
underlying our social, economic, and cultural life .

480 TAX-i;~gt'NIPT Pòt3 A'rrorrs

Another "comment of interest . regarding this report is quoted from
"The Turning of the Tides", part II, by Paul W . Shafer, Member of
Congress, page 30.2 This was published in 1953 .
A strategic wedge was driven in 1934 following the conclusions and recommen-
dations of the American Historical Association's commission on social studies .
Its point of entry was adroitly chosen . The commission proposed to consoli-
date the traditional high school subjects of geography, economics, . sociology, polit-
ical science, civics and history, into a single category -designated as . the social
studies. Here was the most strategic of all teaching areas for the advancement
of a particular philosophy.
Success in enlisting teachers in this field in the cause of a new social order
would have an influence out of all proportion to the number of teachers involved .
What this all meant was summed up by Prof . Harold J . Laski, philosopher of
British socialism . He stated
"At bottom, and stripped of its carefully neutral phrases, the report, is an edu-
cational program for a socialist America ."
EVALUATION OF THE EVIDENCE
Before undertaking a more detailed analysis of the influences work-

ing in the educational world, we wish to say emphatically and to have
it understood clearly that our evidence is not directed toward nor does
it indict our large educational staff, the hundreds of thousands of
teachers and supervisors whose merit and loyalty are beyond all ques,-
tion. Let no one overlook this.
We are differentiating between this widely distributed educational
staff and the top level centers of influence in which educational plan§
and policies are ormulated .
There is in every operating unit, be it factory, office, union, council,
or association a method or fashion of work that is determined by
policies originating at the top . Were it not so, the organization
would soon disintegrate . So it is in the world of education and
government.
Perhaps, as this pertains to the field of education, the principle
and its application can be well illustrated by quotation from some
observations by the Ford Foundation . These quotations, as will be
noted, emphasize the importance of concentrated effort for maximum
results.
From the Fund for Advancement of Education, annual report
1951-52,,page 6
In an effort to be useful at too many points in the whole system of education
it could easily fall into what an early officer of the Rockefeller Foundation
called "scatteration giving" and thus fail to be of any real value to education
anywhere. Given limited resources, selection was inevitable . Given a desire
to be of mavimum usefulness, concentration was essential .
Referring to a survey on military education (p . 24)
This survey made clear that the effectiveness of educational work in any
military location depends very largely on the degree of importance which the
commanding officer attaches to it and the interest and competence of the officers
conducting it . It seemed clear, therefore, that the preparation of officers to
assume responsibility for education in the military services was the key to
effectiveness of orientation programs . The fund plans, therefore upon request
from the Office of Defense, to support pilot projects for introducing into the
programs of ROTC units substantial preparation for leadership in the kind
of education appropriate in the military forces of a democracy .
∎ See also Congressional Record, March 21, 1952 .


From the report on the Behavioral Sciences Division of the Ford
Foundation-June 1953 (p . 24)
Accepting the diagnosis of a leading figure in the field-that "training of
a moderate number of first-rate people is in the present juncture far more
urgent than that of a large number of merely competent people." The division
took as a first step the development of plans for what came to be known as
the Center for Advanced Study in the Behavioral Sciences .
Page 28
In sum, then, the Foundation's hope and expectation is significantly to
advance the behavioral sciences-to get farther faster-through the temporary
concentration at one place of the ablest scholars and the most promising
younger people studying together in the most effective way that the state of
the field now permits .
(Note .-All emphasis supplied.)
While we have noticed other references of similar nature and import
in various places, there should be sufficient to support our view that
the pattern is determined at the top . It is also obvious on slight
consideration that in education as in government, the most effective
megaphones and channels of communication are centralized in the
same places . These thoughts should be kept in mind in the evaluation
of the evidence as it will be presented .
There is another point for consideration that bears upon the
excerpts which will be quoted later . Criticism is frequently made
about distortion of meaning by lifting such quotations from context .
This is sometimes true . In this case a consistent effort has been made
to avoid such distortion and we believe we have succeeded . In any
event full reference as to source is given and anyone who wishes to
criticize may have access to the complete text if he wishes to be right
before he comments . Furthermore, the confirming similarities of so
many quotations from various sources should clearly mark the paths
they follow .
Attention should be called to still another significant factor in
this situation . It is the fact that most of the information submitted
in these quotations appears and is available only in professional publi-
cations whose circulation is largely confined to those engaged in these
professions . This results naturally in two things : One, the coordi-
nated effectiveness within the profssional groups is increased ; two,
relatively few of the citizenry outside these professional circles have
any means of knowing what is developing and therefore of organiz-
ing any protest against it . In fact much of the meaning of some
articles would be obscure to the average citizen because of the subtle
approach and highly technical vocabulary .
This closely channeled flow of information should also be a con-
cern of the trustees of the foundations . Men of unquestioned com-
petence and integrity must often be selected as trustees for their
proficiency and prestige in their chosen lines of work . They have
little time in their busy lives for studious attention to the develop-
ments in the highly professional fields bearing little direct relation
to their own responsibilities . If this be true, the problem posed should
be searched for a solution.
THE AGE OF TRANSITION-LAISSEZ FAIRE IS CLOSING
In proceeding with an analysis of the application of the conclu-
sions and recommendations of the Commission on Social Studies as
54608-54-3
they specifically pertain to education, we wish to call attention to the

emphasis given to the alleged transitional character of the present
period. In addition to the previous quotations, the following
excerpts also tend to confirm these views.
Page 647 :
A dying laissez faire must be completely destroyed and all of us, including
the "owners" must be subjected to a large degree of social control . A large
section of our discussion group, accepting the conclusions of distinguished
students, maintain that in our fragile, interdependent society the credit agencies,
the basic industries and utilities cannot be centrally planned and operated
under private ownership .
That is from Education for the New America, . by Williard E .
Givens, in the proceedings of the 72d annual meeting of the National
Education Association.
Mr. Givens was executive secretary of the National Education
Association from 1935 to 1952 . At the 79th annual convention of the
American Association of School Administrators held February 14-19,
1953, at Atlantic City, N . J ., the annual American education award
was presented to Mr . Givens, "whose many contributions to the field
of education are without parallel."
Page 125
The days of little-restricted laissez faire, the days when government was
looked upon as a necessary evil-these have gone for a long time, perhaps
forever, although in the mutations of time one never knows what forms may
recur.
"On the Agenda of Democracy," by C . E . Merriam, vice chairman,
National Resources Planning Board, Harvard University Press, 1941 .
EDUCATIONAL LEADERSHIP IN THE AGE OF TRANSITION
We find that the responsibilities of the leaders and teachers in the

world of education are especially emphasized during this age of transi-
tion, as demonstrated in the final report, 16th volume, of the Commis-
sion on Social Studies as previously quoted on page 15 .
In the' midforties, the President appointed a Commission on Higher
Education . Their conclusions and recommendations were reported in
a series of six pamphlets in December 1947 . Mr. George F . Zook,
president of the American Council of Learned Societies, was chairman
of this Commission.
In the Commission's reports they gave credit to the following organ-
izations for aid received : American Council of Learned Societies,
American Council on Education, National Research Council, Social
Science Research Council, American Association of University Pro-
fessors, and Association of Land Grant Colleges and Universities .
The following quotations are taken from the pages indicated in vol-
ume I of the Report of the President's Commission on Higher Edu-
cation
Page 6 :
Education : Perhaps its most important role is to serve as an instrument of
social transition, and its responsibilities are defined in terms of the kind of
civilization society hopes to build .
Page 84 :
Higher education must be alert to anticipate new social and economic needs,
and to keep its programs of professional training in step with the requirements
of a changing and expanding cultural, social, and econ-mic order .
Page 85
Social forces have modified and are continuing to modify at an increasingly
rapid rate, the context within which graduate schools must function, and read-
justments of a fundamental nature are urgently necessary if these university
units are not to block rather than advance the progress of education-and,
through education, of the Nation .
With all the emphasis placed upon this age of transition and edu-
cation's important part in it as typified by the foregoing quotations,
and since we are deluged with the idea that change itself is progress,
a note of interest is struck by another thought . It is that perhaps
this agitation for and about change is only a temporary means to a
different end-one of unchanging stability when certain objectives are
reached .
As far in the past as 1918, the Intercollegiate Socialist for October-
November 1918 published an article entitled, "The Minimum of Edu-
cation," by Ellen Hayes . The ensuing quotation is the opening para-
graph in that article
Assuming the surplus wealth secured to the public for social purposes, how can
a fraction of it be used educationally to promote and stabilize the common
good ; and to this end, what is the irreducible minimum of education which must
be guaranteed to every member of the national commonwealth?
Volume I of the Report of the President's Commission on Higher
Education also includes additional interesting comments
Page 6
The efforts of individual institutions, local communities, the several states,
the educational foundations and associations, the Federal Government will be
more effective if they are directed toward the same general ends .
Page 16
PREPARATION FOR WORLD CITIZENSHIP
In speed of transportation and communication and in economic interdepend-

ence, the nations of the globe are already one world ; the task is to secure recog-
nition and acceptance of this oneness in the thinking of the people, as that
the concept of one world may be realized psychologically, socially and in good
time politically .
It is this task in particular that challenges our scholars and teachers to lead
the way toward a new way of thinking .
Page 20
There is an urgent need for a program for world citizenship that can be
made a part of every person's general education .
Page 21 :
It will take social science and social engineering to solve the problems of
human relations . Our people must learn to respect the need for special knowl-
edge and technical training in this field as they have come to defer to the expert
in physics, chemistry, medicine, and other sciences .
Page 22
The colleges and universities, the philanthropic foundations, and the Federal
Government should not be tempted by the prestige of natural science and its
immediately tangible results into giving it a disproportionate emphasis in
research budgets or in teaching programs . It is the peculiar responsibilty of
the colleges to train personnel and inaugurat extensive programs of research
in social science and technology . To the extent that they have neglected this
function in the past, they should concentrate upon it in the decades just ahead .
Page 23 : .
Colleges must accelerate the normal slow rate of social change which the
educational system reflects ; we need to find ways quickly of making the under-
standing and vision of our most farsighted and sensitive citizens .the common
possession of all our people .
Pages 38 and 39
Educational programs everywhere should be aimed at undermining and
eventually eliminating the attitudes that are responsible for discrimination
and segregation-at creating instead attitudes that will make education freely
available to all .
Page 91 :
The detached, perceptive scholar, is still sorely needed-in increasing num-
bers and in all disciplines . But if higher education is to discharge its social
obligations, scholars also are needed who have a passionate concern for human
betterment, for the improvement of social conditions, and of relations among
men . We need men in education who can apply at the point of social action
what the social scientist has discovered regarding the laws of human behavior .
Page 92
It will be a little short of tragic if provision for social research is not included
in the program of Federal support and organization planned under a National
Science Foundation. Certainly the destiny of mankind today rests as much with
the social sciences as with the natural sciences .
One of the members of the President's Commission on Higher Edu-
cation was Horace M . Kallen who for years has been active in the edu-
cational field .
In the issue of Progressive Education for January-February, 1934,
in an article called, Can We Be Saved by Indoctrination? Mr . Kallen
says on the pages noted
Page 55
I find, within the babel of plans and plots against the evils of our times, one
only which does not merely repeat the past but varies from it . This is a proposal
that the country's pedagogues shall undertake to establish themselves as the
country's saviors . It appears in two pamphlets. The first is a challenge to teach-
ers entitled, "Dare the Schools Build a New Social Order?" Its author is George
Counts . The second is, "A Call to the Teachers of the Nation ."
Page 56
With an imagination unparalleled among the saviors of civilization, with a faith
stronger than every doubt and an earnestness overruling all irony, Mr . Counts
suggests that the Great Revolution might be better accomplished and the Great
Happiness more quickly established if the teachers rather than the proletarians
seized power.
Having taken power, the teachers must use it to attain the "central purpose" of
realizing the "American Dream ." They must operate education as the instrument
of social regeneration . This consists of inculcating right doctrine .
The milder Call says
Teachers cannot evade the responsibility of participating actively in the task of
reconstituting the democratic tradition and of thus working positively toward
a new society .
The references to Mr . George Counts in the foregoing excerpts natu-
rally bring to mind Teachers College of Columbia University and its
group of contemporary professors, John Dewey, W . H . Kilpatrick,
George Counts, and Harold Rugg, all identified actively for many
years with educational organizations and activities of one form or
another .
One of the students who graduated from Teachers College is Nor-
man Woelfel . After attending State Normal School in Buffalo, N . Y .,
he entered Teachers College of Columbia University where he received
his bachelor of science degree in 1923, his master of arts in 1924 .
After further work in study and teaching at other institutions includ-
ing Johns Hopkins, he returned to Teachers College and in 1933, at
the mature age of 38 years, received his degree of doctor of philos-
ophy. His doctoral dissertation was entitled : "A critical review of
the social attitudes of 17 leaders in American education ."
At this point. we wish to make it emphatically clear that we know
of no grants from any foundation in the prosecution of this work .
Other connections will be reviewed later that identify Mr . Woelfel
with educational activities in a similar field .
This doctoral thesis, of which a copy is on file in the Congressional
Library, was published as a book by the Columbia University Press
under the title, "Molders of the American Mind ." At least three
printings were made which indicates a good circulation . It is based
upon a review of social attitudes of 17 leaders in American educa-
tion. The following excerpts are taken from the pages indicated .
The dedicatory page
To the teachers of America, active sharers in the building of attitudes, may
they collectively choose a destiny which honors only productive labor and pro-
motes the ascendency of the common man over the forces that make possible
an economy of plenty .
Page 10
The younger generation is on its own and the last thing that would interest
modern youth is the salvaging of the Christian tradition . The environmental
controls which technologists have achieved, and the operations by means of
which workers earn their livelihood, need no aid or sanction from God nor
any blessing from the church .
Page 26
The influence which may prove most effective in promoting the demise of
private business as the dominant force in American economic life is the modern
racketeer. His activities are constantly in the spotlight of public attention,
and the logic upon which he pursues them is the logic of competitive business .
He carries the main principles of the business life to their logical extreme and
demonstrates their essential absurdity . Like the businessman he is interested
in gain, and like the businessman he believes in doing the least to get the most,
in buying cheap and selling dear . Like the businessman he believes in attain-
ing a monopoly by cornering the market whenever possible . The chief differ-
ence between the racketeer and the businessman is that the businessman's
pursuits have about them an air of respectability given by customary usage and
established law . He may pursue them in the open, advertise them in the pub-
lic press and over the radio, whereas the racketeer must work undercover .
Page 240
In the minds of the men who think experimentally, America is conceived as
having a destiny which bursts the all too obvious limitations of Christians
religious sanctions and of capitalistic profit economy .
From the vantage point of the present study, the following objectives for edu-
cators are suggested . They, in no sense, purport to be all-comprehensive or
final. They do, however, lay claim to be along the line of much needed strat-
egy if educational workers are to play any important part in the society which
is building in America .
1 . The maturing of personal viewpoint by reading and discussion, by scrutiny

of contemporary civilization, and by self-examination .
2 . A continuing effort to clarify the vision of an educator's function in Amer-
ican civilization . In what degree does he carry the responsibility for controlled
social evolution? To what extent is he more than a mere public servant engaged
in carrying out orders issued by executives?
3. The blotting out of the "brass halo" which teachers have long suffered under .
This means a will not to be affected by the slushy epithets of public apologists
for existing social institutions and a will to assist youth constantly towards
ready discernment of apologetics in any form .
4. Immersion into the budding native culture by steady enlargement and culti-
vation of professional and nonprofessional cultural opportunities available
in the social environment . This is really the highest obligation of an intelligent
teacher, because the value of any' form of specialized professional endeavor
can be gaged only by reference to the extent and depth of the individual's par-
ticipation in, and appreciation of, existing social life .
5. Active participation by educators and teachers in various organizations of
the lay public agitating for social reforms whose realization would be in har-
mony with evolving ideals of American society .
6 . The thoroughgoing renovation of existing professional organizations of edu-
cators so that in aim and principle they shall be intelligently militant in criticism
of all vested interests in society and similarly militant in support of evolving
modern standards of value in all fields of human interest .
7 . Amalgamation of existing professional educational organizations for the
purpose of united action on all questions of broad social import at anytime before
the public anywhere in the land .
8. Promotion of the spiritual solidarity of all classes of intellectuals in the
interest of enlightening and possibly of guiding inevitable future mass movements
within the population .
9. Active participation of individual educators and of professional organiza-
tions of educators in the gradually crystallizing public effort to create out of pre-
vailing chaos and confusion in economic, political, spiritual, ethical, and artistic
realms a culture which is under no continuing obligations to past American or
foreign cultural pattern .
10. A teacher-training program conceived in the light of the changing aims and
functions of education in contemporary America . This implies the critical re-
examination of all established precedents in teacher-training organization .
11 . A system of school administration constructed under the guidance, of ex-
perimental social philosophy with the major aim of meeting the profesional
needs of teachers. This implies relegating the elaborate administrative tech-
nology modeled after business practice and capitalistic finance to the background
where it may be drawn upon when needed in reconstruction programs .
12 . The attitude of creative inquiry to be clearly recognized as essential in
all people of the teaching profession . The trained specialists and the elaborate
scientific technology of educational research, as conceived at present, to be made
available as supplementary service agencies in the solution of the actual prob-
lems of teaching.
13. The incorporation of graduate and undergraduate schools of education into
a general plan of public education, so that their resources in experts and in ex-
perimental facilities may be used effectively in continuing educational recon-
struction .
14 . A program of public elementary and secondary education organized in the
interest of collective ideals and emphasizing the attainment of economic equality
as fundamental to the detailed determination of more broadly `cultural aims .
15 . Centralized organization in public education to an extent which will not
only guarantee provision of the most valid knowledge together with adequate
facilities for incorporating it into educational practice in every local community
throughout the country, but promote as well the construction of attitudes, in the
populace, conducive to enlightened reconstruction of social institutions .


16 . A, program of public vocational, professional, and higher education inte-
grally organized in terms of a social order wherein all natural resources and the
entire industrial structure is controlled by governmental agencies and operated
for the equal benefit of all . This portends educational planning in terms of
broadly cultural and creative motives and the final disappearance of programs of
education based upon the motive of individual monetary success .
17. Gradual amalgamation of all cultural forces in community life, including
industry, radio, motion pictures, newspapers, libraries, art galleries and
museums, the theater, the opera, musical organizations, book publication, and •t he
school itself into an educational program as wide and as continuous as life .
18 . Such autonomy for every classroom teacher, from the nursery school
through the university as accords with true artistic integrity . This implies that
teachers shall be answerable for their professional conduct to their own profes-
sional organizations which, in turn, shall be fully responsible to the public .
19 . The abolition of the present supervisory system in public education and
its replacement by higher professional qualifications for teachers and by public
teacher service bureaus equipped to continue on a voluntary basis the in-service
education of teachers.
20 . Gradual abolition of specified grades, subjects, textbooks, testing, and
promotion schemes as conceived under the present administrative-supervisory
set-up in public education . The development of a series of flexible organiza-
tional schemes and teaching programs by local faculties under the guidance
and sanction of professional associations and of the lay public .
21 . Domination of all specific teaching aims for an indefinite period by the
general aim of rendering the attitudes of all normal individuals toward all
the problems of life sufficiently tentative to allow for growth and change .
22. Determination of all directly functional teaching aims in and during the
educational process by reference to the needs and possibilities of pupils as
determined by professionally qualified and socially conscious teachers .
The value of these extended excerpts might be questioned in this
case were it not for the fact that so many of the suggestions conveyed
in the foregoing paragraphs have their counterparts on the other
side of the triangle in the field of governmental planning for the
Nation.
In the January-February issue of the magazine, Progressive Educa-
tion in 1934, there appeared an article called "The Educator, The
New Deal, and Revolution," by Normal Woelfel. On the pages noted,
the following statements appeared in this article .
Page 11 :
The call now is for the utmost capitalization of the discontent manifest
among teachers for the benefit of revolutionary social goals . This means that
all available energies of radically inclined leaders within the profession should
be directed toward the building of a united radical front . Warm collectivistic
sentiment and intelligent vision, propagated in clever and undisturbing manner
by a few individual leaders, no longer suits the occasion .
I would like to pause to call attention again to the phrase "in
clever and undisturbing manner by a few individual leaders, no longer
suits the occasion."
Page 12
If we wish the intelligent utilization of the marvelous natural resources
and the superb productive machinery which America possesses, for all of the
people, with common privileges, and an equal chance to all for the realization
of exclusively human potentialities-that is possible, although we must not
blindly shrink from the fact that it may require some use of force against those
at present privileged.

I wish to state here that these quotations just given, as previously

said, are from the magazine Progressive Education, a publication of
the Progressive Education Association which has received at least
$4,258,000 from the foundations .
In October of 1934, the first issue of a new magazine appeared,
entitled, "The Social Frontier ." It was described as "A Journal of
Educational Criticism and Reconstruction ." George S . Counts was
the editor and Mordecai Grossman and Norman Woelfel were the
associate editors .
The first pages were devoted to editorials which were unsigned .
There follows hereafter a copy of the material appearing on the cover
page and after that excerpts from the editorials named on the pages
noted.
Quoting the cover page we have
THE SOCIAL FRONTIER-A JOURNAL OF EDUCATIONAL CRITICISM AND
RECONSTRUCTION
1776
We hold these truths to be self-evident, that all men are created equal, that
they are endowed by their Creator with certain inalienable rights, that among
these are life, liberty, and the pursuit of happiness (the Declaration of Inde-
pendence) .
1934
The age of individualism and laissez faire in economy and government is
closing and a new age of collectivism is emerging (Report of the Commission on
Social Studies of the American Historical Association) .
In this issue : John Dewey, Charles A. Beard, Henry P. Fairchild, Sidney Hook,
Goodwin Watson .
Volume I-October 1934-No . I-$2 a year
Now quoting from page 3, Orientation

In a word, for the American people, the age of individualism in economy is
closing and an age of collectivism is opening . Here is the central and dominating
reality in the present epoch .
Page 5, Educating for Tomorrow
To enable the school to participate in raising the level of American life the
educational profession must win meaningful academic freedom, not merely the
freedom for individuals to teach this or that, but the freedom of the teaching
profession to utilize education in shaping the society of tomorrow .
Mr. HAYS . Mr. McNiece, I have a question right there . Does that
magazine still exist?
Mr. MONiECE . It ran for quite awhile, and the name of the asso-
ciation itself was changed subsequent to this . Then I was informed
only yesterday, and I haven't had time to look it up, it was converted
back to its original name. So far as the continuation of the magazine
itself is concerned, I would have to check that .
TAX-EXEMPT FOUNDATIONS 489,
Mr . HAYS . Well, if you have time during the lunch hour, would
you check that?
The reason I interrupted you, I wanted you to do that for this&
afternoon .
Mr . McNUcE . We will try to do that .
Now, on page 7, there is an editorial called The Ives Law
On August 10, 1934, Governor Lehman of New York signed the Ives bill.
According to the provisions of the law, every professor, instructor, or teacher
employed in any school, college, or university in the State must subscribe to the
following oath or affirmation : "I do solemnly swear (or affirm) that I will sup-
port the Constitution of the United States and the constitution of the State of
New York, and that I will faithfully discharge, according to the best of my-
ability, the duties of the position to which I am now assigned ."
The reactiofi of teachers to such a governmental measure is naturally one of
resentment.
Page 8, The Ives Law
There is grave danger that the new law will have the effects desired by its,
sponsors, not however, because of any restrictions inherent in the oath itself
but rather because of the traditional timidity and ignorance of teachers. Yet
forward-looking members of the profession can find in this oath a direct mandate .
for broad participation in the alteration of the now existing pattern of American
society .
Quoting again from Educating for Tomorrow, page 7
The task of enlarging the role of education in shaping the future of our collec-
tive life cannot be accomplished by individual educators nor by individual
institutions . It is a task for an organized profession as a whole . It is a task:
which the NEA might make its central project .
Page 7, Educating for Tomorrow
We submit to the membership of the NEA that its role in the life of the •
nation would be greatly enhanced if it identified itself with an ideal of social
living which alone can bring the social crisis to a happy resolution-a collecti-
vistic and classless society . We further submit that the effectiveness of the
NEA would be greatly increased if instead of looking for defenders of education
among the ranks of conservative groups, it would identify itself with the under-
privileged classes who are the real beneficiaries of public education and who ,
can find their adjustment only in a radically democratic social order .
It is interesting to note that Norman Woelfel, then an associate•
editor of the Social Frontier, who is now professor of education at
Ohio State University, is now actively participating in the activities :
of the National Education Association .
Mr. HAYS . Just a moment, you say you are talking about Woelfel
now?
Mr. McNIECE . Yes.
Mr . HAYS . And he is at Ohio State and he is a member of the,
NEA, too?
Mr. MCNIECE . According to the NEA booklet .
Mr . HAYS . How subversive can you get?
Mr. McNIECE . One of the departments of NEA is the Association
for Supervision and Curriculum Development . This association
recently issued its yearbook for 1953 under the title "Forces Affect-
490, TAX-EXEMPT; FOUNDATIONS
ing American Education." Professor Woelfel was a member of the

supervising committee responsible for the creation of this work.
Under the caption Culture Affecting Education the following state-
ments appear, and this is in 1953
Page 27
Teachers in our schools have an immediate responsibility to their students and
to the community at large to rethink their programs in terms of the necessity of
social adaptation to changing technology .
Page 27
We began our government with the rule of law-the Constitution . The federal
judicial system has become its special guardian . Over the years there has been
a gradual modification of the principle of property rights and of public welfare .
An illustration of a fundamental transition which is affecting our lives is the
modification of the old concept of the common law . The common law in America,
which is merely English law built up through decisions of the courts, has been
individualistic. It has stressed protection of property and freedom of contract.
Where the welfare of society has been concerned, the common law has been
.assumed to be sufficient to effect this through the individual . The rationale has
been liberty rather than either equality or fraternity .
This trend toward a balance between the welfare of the individual and the
welfare of society is in conflict with earlier assumptions . It is a trend which
we cannot ignore. It presents fundamental problems for education in modern
society.
Pages 36-37 :
There are tensions and overt conflicts in our present society over the functions
and methods of education . Men who are established at the pinnacle of success in
the typical American conception can and sometimes do find themselves more
interested in shaping society according to their own wishes, through the .public
schools, than in conforming to society's newer demands for free intelligence .
The very power of their positions makes them formidable foes of any concep-
tion of education for all the people that is in conflict with their special con-
victions.
Through the strength of our success patterns it is quite possible for men whose
lives are wholly unrelated to - the process of education to come to power and to
assume the role of determining what should be taught and how it should be
taught . The professional educator whose business it is to know both the process
and the method is not always a match for such opposition . But we should not
forget that many other men, who are also at the pinnacle of success, are the firm-
est defenders of the public schools and the method of intelligence . In recent
years, the public schools have received excellent support from just such per-
sons . Throughout the years, such men have established foundations for the
advancement of education and culture .
Directly or indirectly, the NEA is identified with an interesting situ-
ation involving an article recently published by Look magazine. In
this issue of this magazine of March 9, 1954, an article by Robert M.
Hutchins was published under the title "Are Our Teachers Afraid to
Teach?" The opening statements in this article are as follows
Education is impossible in many parts of the United States today because free
inquiry and free discussion are impossible . In these communities, the teacher
of economics, history or political science cannot teach . Even the teacher of
literature must be careful . Didn't a member of Indiana's Text Book Commis-
sion call Robin Hood subversive?
The National Education Association studied no less than 522 school systems,
covering every section of the United States, and came to the conclusion that
American teachers today are reluctant to consider "controversial issues ."

T,AX-EkkMPT'- 1bi71+7DATIbNS 491

This -article and the statement .quoted above were of interest' to us.
A letter was' therefore written to the 'NEA "asking for information
.about the report on the 522 school systems . The letter in reply to our
request is quoted herewith, together with our letter which preceded it .
MARCH 19,
Mr . FRANK W. HUBBARD,
Director of Research, National Education Association, Washington, D . C.
DEAR MR. HUBBARD : In an article in Look magazine of March 9, 1954, Mr.
'Robert M.' Hutchins refers to a survey made by your association .
He reports that this survey came to the conclusion that teachers of economics,
history and political sciences in 522 school systems, covering every section of
-the United' States, are reluctant to consider controversial issues in their teaching .
This statement suggests the possibility of a serious handicap to education .
We want to evaluate your report so that we may learn the nature of the fears
- to which Mr . Hutchins refers in this article .
Your report will offer us a welcome contribution to our understanding of
the nature of the services rendered by your tax exempt organization, to edu-
cation .
With thanks for your attention, .
Very truly yours,
NORMAN DODD,
Research Director .
I will now quote the reply
NATIONAL EDUCATION ASSOCIATION OF, THE UNITED STATES,
Washington 6, D . C., March-24, 1954.
_Mr. NORMAN DODD,
Research Director, Special Committee to Investigate Tax Exempt Founda-
tions, House of Representatives,
Washington 25, D . C.
DEAR MR . DODD : In reply to your letter of March 19, I am sending you.. a copy
-of the report prepared by the NEA research division in June 1953 for the
NEA committee on tenure and academic freedom . This -report has never been
;printed or issued in any form other than the enclosed typewritten form .
So far as I know Mr . Hutchins did not have a copy of this typed memorandum,
altho he may have borrowed one from someone who received a copy . A few
typewritten copies have been sent to members of the committee on tenure and
academic freedom and to a few other individuals who have written asking
for copies. It is possible that Mr . Hutchins drew his information from the
newspaper stories which were issued from Miami Beach during the summer of
1953 $s a result of a press conference on this report . At any rate, I am not
sure that Mr . Hutchins' conclusions would be exactly those of the NEA re-
search division or of the NEA committee on tenure and academic freedom .
Cordially yours,
FRANK W. HUBBARD,
Director, Research Division .
Inference from this letter seems reasonably clear . Careful reading
by the staff failed to disclose any basis for the conclusion reached by
Mr. Hutchins .
Regardless of the letter quoted, the NEA had many reprints of
this article. The mere existence of these reprints suggests that they
must have been intended for distribution to interested parties .
Whether or not they have been or are being distributed, we do not
know.
We also wonder how many educators would support the conclud-
ing line of Dr . Hutchins' article
No country Rver needed education more, than ours does today .

610 TALC-EXIMPT FOUNDATION$
. Before beginning a discussion of the relationships between founda-

tions and government, it should be understood by all that we realize
that we are entering the sensitive area of political controversy . One
reason for mentioning this at this time is that we wish it to be under-
stood that we are limiting our analysis of the conditions as we shall
describe them, first to documented statements from the sources quoted
and second, in the economics section of the report to statistical infor-
mation available in the Government's own publications.
The economic facts seem to substantiate the conclusion that many
of the proposals advanced by the planners and deemed experimental
by some and questionable by others have been put into practice and
are a part of our everyday lives as we are now living them . Congres-
sional appropriations and governmental expenditures indicate this .
While these facts seem to speak for themselves, there are certain inter-
pretations which we shall make especially with reference to future
conditions if we choose to continue these collectivistic ventures .
In these conclusions we are taking no partisan political position, nor
do we wish to encourage or support any other attitude than this .
Our interest in these problems as they affect the state of the Nation
and its future far exceeds our interest in any form of political pref-
ferment.
Now, this section of the manuscript report is headed, "Relationships
Between Foundations and Government." It is particularly concerned
with the national and social planning .
Before proceeding with the submission of evidence bearing upon
the relationships between foundations and government, we wish to
make some comments by way of background as they pertain to na-
tional and social planning bq government.
Three things should be obvious to anyone reasonably familiar with
the interlocking complexities of our production, distribution, service,
and financial problems in our economy
(1) The successful correlation of all these activities would require
the complete control of all phases of our economic endeavors. Price
control, for example, cannot be effectively maintained without rig-
orous control of material supply and costs, wages, transportation, and
all other elements entering into final costs .
Mr. HAYS . Mr. Chairman, it seems to me that these reports are very
long, and if Mr . McNiece is going to read all of them today, that is
about all we are going to get done . I have read them . I have some
questions I would like to ask about them . I would like to just have
them put in the record as is, and then go on with the questioning . I
think it would save a lot of time .
Mr. KocH . He was just going to read the shorter one .
Mr. HAYS . Is he going to read the typewritten introduction of this?
Mr. Kocx . No .
Mr. McNIECE. I had expected to take selective manuscript reading .
It would be dull and deadly, and I would say completely impossible
to convey to anyone the message involved in that great series of, I
think, 20 statistical tables . I could not hope to do that by reading.
I had not expected to do that .
Mr. Kocx . You intended to read only the mimeographed statement?
Mr. McNIEcE . Yes, and certain conclusions and introduction ma-
terial from the Economic Report .
The CHAIRMAN . This is 19 pages .
Mr. McNIECE. That is all .
Mrs. PEOST. There is a lot of single spacing and tightly written
pages .
The CHAIRMAN. The quotations are single spaced . Had you ex-
pected to read the quotations in full?
Mr. MCNIECE . I had intended to read the quotations in full . It is
immaterial to me.
The CHAIRMAN . Why don't you continue with the shorter form?
The other material is to be inserted in the record .
Mr. MCNIECE. That is right . There are certain things in these
quotations that I think from my point of view are very important
from the standpoint of Mr . Hays' questions .
The CHAIRMAN . Very well.
Mr. HAYS. I have about 8 or 10 questions to this document, and I
was wondering if you have any objection in order to prevent the dis-
organized thing we have had in the past, and going some other day
you could read them and answer all of my questions before noon
Would you have any objection if I stopped you at the bottom of page
2 and asked a question right there while it is fresh in mind?
The CHAIRMAN . What he had in mind, as I understood a while
ago, in the remainder of this brief form might be the basis for answers.
I have not read these quotations . I would rather like to hear them,
if I might, before the questioning . I think we would have time before
noon to conclude this and have the questioning also before noon, which
I would like to do.
Mr. MCNIECE . Yes, we could .
The CHAIRMAN . For my own information, I would rather like to
have it .
Mr. MCNIECE . It is very vital, Mr . Reece, to the questions which
Mr. Hays very properly asked . I would like at least to present those
that bear upon this idea of, let us say, a concentrated corps of influence .
It is involved here to a certain extent . It is involved in one of the
very first questions Mr . Hays asked me this morning . So I think it
would be better if we could at least go this far with it .
Mr. HAYS . Read this whole thing?
Mr. MCNIECE . Yes, it is not going to take very long .
The CHAIRMAN . Very well .
Mr. MCNIECE . Otherwise, shortages, surpluses, and bottlenecks
would bob up continuously and everywhere .
(2) With the complexity due to the literally millions of points or
junctures where difficulties may arise, no man or centralized group of
men possess the knowledge or judgment that will equal the integrated
judgment of thousands of experienced men applied at the points where
and when troubles first develop.
At the time when increased complexity of national and interna-
tional affairs seem to make more governmental planning and control
necessary, the Government is actually becoming less and less able to
exercise rational and competent control over the multiplicity of details
essential to good planning . To be even superficially effective, it must
be completely autocratic .
(3) Even though such centralized planning were physically pos-
sible, the net results would be a smaller and smaller percentage of
goods and services produced that would be available for those who
produce them . This would result from the increasing cost of the
governmental agencies and bureaus necessary to devise and maintain

control . Of course this would have to be met by increasing taxation .
That is the experience in Russia and it has been developing here for
some years as will be shown in the staff's economic report .
From the beginning, the Socialist programs have called for national
ownership and planning of productive facilities .
Such references are frequent and clear . Perhaps the following quo
tation from Engels, friend and contemporary of Marx, may illustrate
the point.
The planless production of capitalist society capitulates before the planned
production of the invading Socialist society .
To emphasize the reiteration of this concept by a responsible body
of men in our own times and country, we may again refer to a ara-
graph from the report of the Commission on Social Studies . After
ph 5
years of deliberation they say (American Historical Association,
Committee on Social Studies, p . 16)
Under the molding influence of socialized processes of living, drives of
technology and science, pressures of changing thought and policy, and disrupt-
ing impacts of economic disaster, there is a notable waning of the once wide-
spread popular faith in economic individualism ; and leaders in public affairs,
supported by a growing mass of the population, are demanding the introduction
into economy of ever wider measures of planning and control .
In what way has this expression of belief found its way into our
governmental activities?
In 1933, the National Planning Board was formed . How did it look
upon its task and what seem to be its final objectives? These may be
indicated in part by the following extracts from its final report for
1933-34-National Planning Board, final report 1933-34, page 11 :
State and interstate planning is a lusty infant but the work is only beginning ..
Advisory economic councils may be regarded as instrumentalities for stimu-
lating a coordinated view of national life and for developing mental attitudes
favorable to the principle of national planning .
Page 60
Finally, mention should be made of the fact that there are three great national
councils which contribute to research in the social sciences . The Council of
Learned Societies, the American Council on Education, and the Social Science
Research Council are important factors in the development of research and add
their activities to the body of scientific material available in any program of
national planning.
The Council of Learned Societies has promoted historical and general social
research .
The American Council on Education has recently sponsored an inquiry into
the relation of Federal, State, and local governments to the conduct of public
education. It has served as the organizing center for studies of materials of
instruction and problems of educational administration . It represents the educa-
tional organizations of the country and is active in promoting research in its
special field .
The Social Science Research Council, a committee of which prepared this
memorandum, is an organization engaged in planning research . It is true that
its object has not been to make social plans, but rather to . plan research in the .
social field . A decade of thought on planning activities through its committees,
distributed widely over the social sciences, has given it an experience, a back-
ground with regard to the idea of planning, that should be of value if it were
called on to aid in national planning, Furthermore, the members of the Social
Science Research Council, its staff, and the members of its committees are per-
haps more familiar than the members of any other organization with the per-
sonnel in the social sciences, with the research interests of social scientists, and
with the experience and capabilities'of'social science research workers in the
United, States . The members of the council are familiar with the different bu
reacts i` research: The council has been concerned chiefly with the determina-
tion of the groups and persons with whom special types of research should be
placed . For this purpose it has set up committees, organized commissions, pro-
moted research, and sponsored the development of various research agencies and
interests. With its pivotal position among the social sciences, it could undoubted-
ly render valuable aid if called on to do so, in the formidable task of national
planning.
Page 66
It was after the Civil_ War that American economic life came to be dominated
by the philosophy of laissez faire and by the doctrines of rugged individualism .
But the economic and social evils of the period resulted in the development of
new planning attitudes tending to emphasize especially public control and
regulation.
Page 67
Summing up the developments of these 125 years, one may say that insofar as
the subject here considered is concerned, they are important because they left
us a fourfold heritage
First, to think in terms of an institutional framework which may be fashioned
in accordance with prepared plans ;
Second, a tendency to achieve results by compromise .in which different lines-
and policies are more or less reconciled ;
Third, a tendency to stress in theory the part played in economic life by
individualism, while at the same time having recourse in practice to govern-
mental aid and to collective action when necessary ; and
Fourth, a continued social control applied to special areas of economic life.-
Page 71 :
Such was the note already heard in America when during 1928-29 came the-
first intimations of the 5-year plan, and the Western World began to be inter-
ested in the work and methods of the Gosplan in Moscow. The Russian expe-
rience was not embodied in any concrete way in American thinking, but it stim-
ulated the idea that we need to develop in an American plan out of our American
background .
The National Planning Board after furnishing its report in 1934
was discontinued.
The National Resources Committee was in existence from 1934 to ,
1939 .
In 1939, the National Resources Planning Board was constituted, in
part with the same personnel. After a few years of deliberation, it
rendered its final report, from which the following verbatim and
continuous extract is quoted from page 3
The National Resources Planning Board believes that it should be the declared'
policy of the United States Government to promote and maintain a high level'
of national production and consumption by all appropriate measures necessary
for this purpose . The Board further believes that it should be the declared'
policy of the United States Government.
To underwrite full employment for the employables ;
To guarantee a job for every man released from the Armed Forces and the-
war industries at the close of the war, with fair pay and working conditions ;
To guarantee and, when necessary, underwrite
Equal access to security,
Equal access to education for all,
Equal access to health and nutrition for all, and
Wholesome housing conditions for all .
This policy grows directly out of the Board's statement concerning which ,
the President has said
"All of the free peoples must plan, work, and fight together for the mainte-
nance and development of our freedoms and rights."
'614 TAX-EXEMPT FOUNDATIONS
THE FOUR rnFEDOMs

Freedom of speech and expression, freedom to worship, freedom from want,
and freedom from fear : and
A NEW BILL OF RIGHTS
1. The right to work, usefully and creatively through the productive years ;
2 . The right to fair pay, adequate to command the necessities and amenities
of life in exchange for work, ideas, thrift, and other socially valuable service.
Mr. HAYS. Would you mind identifying where this came from?
Mr. McNiECE . Yes, Sir . This is the final report of the National
Resources Planning Board.
Mr. HAYS . All right .
Mr. MCNIECE (reading)
3 . The right to adequate food, clothing, shelter, and medical care ;
4. The right to security, with freedom from fear of old age, want, dependency,
sickness, unemployment, and accident ;
5 . The right to live in a system of free enterprise, free from compulsory
labor, irresponsible private power, arbitrary public authority, and unregulated
-monopolies ;
6 . The right to come and go, to speak or to be silent, free from the spyings
of secret political police ;
7 . The right to education, for work, for citizenship, and for personal growth
and happiness ; and
8 . The right to equality before the law, with equal access to justice in fact ;
9. The right to rest, recreation, and adventure, the opportunity to enjoy
life and take part in an advancing civilization .
Plans for this purpose are supported and explained in this report . The pre-
vious publications of the Board, including National Resources Development
Report for 1942, transmitted to the Congress by the President on January 14,
1942, and a series of pamphlets (After Defense-What? After the War-Full
Employment, Postwar Planning, etc .), also provide background for this pro-
posal.
The plans just mentioned are incorporated in a series of points
under the following captions
Page 13 : A . Plans for Private Enterprise .
Page 13 : B . Plans for Finance and Fiscal Policies .
Page 13 : C . Plans for Improvement of Physical Facilities .
Page 16 : D . Essential Safeguards of Democracy.
Under a caption, "Plans for Services and Security" are extensive
recommendations under the descriptive headings which follow
Pages 16-17 :
A. Plans for Development of Service Activities .
1 . Equal access to education .
2. Health, nutrition, and medical care.
B . Plans for Underwriting Employment
C. Plans for Social Security
Still another basic caption appears as follows
Pages 60-66 : Equal Access to Health
I . Elimination of All Preventable Diseases and Disabilities .
II . Assurance of Proper Nutrition for All Our People .
III . Assurance of Adequate Health and Medical Care for All .
IV . Economical and Efficient Organization of Health Services .


A statement of authorship of .the section on Equal Access to Health
says that it was prepared under the direction of Assistant Director
Thotas C . Blaisdell, by Dr. Eveline M . Burns, of the Board's staff .
Dr. Burns is a graduate of the London School of Economics, which
has received grants from the Rockefeller Foundation totaling
$4,105,600 .
The discussion and detailed recommendations in this final report
of the National Resources Planning Board are far too lengthy to be
incorporated in this study . Certainly, some of them seem reasonable
from the standpoint of our former governmental procedure but others
are sufficiently novel to warrant mention herein in order to clarify
the underlying objectives in the fields mentioned .
PLANS FOR IMPROVEMENT OF PHYSICAL FACILITIES'
We recommend for consideration : With private enterprise, through the Recon-

struction Finance Corporation or possibly one or several Federal Development
Corporations and subsidiaries providing for participation of both public and
private investment and representation in management-particularly for urban
redevelopment, housing, transport terminal reorganization, and energy develop-
ment. Government should assist these joint efforts through such measures as,
(1) Government authority to clear obsolescent plant of various kinds, as, for
instance, we have done in the past through condemnation of unsanitary dwell-
ings, to remove the menace to health and competition with other or better
housing.
(2)' Governmental authority to assemble properties for reorganization and
redevelopment-perhaps along the lines of previous grants of the power of
eminent domain to canal and railroad companies for the acquisition of rights-
of way.
HEALTH, NUTRITION, AND MEDICAL CARE
Assurance of adequate medical and health care for all, regardless of place of
residence or income status and on a basis that is consistent with the self respect
of the recipient, through
(1) Federal appropriations to aid States and localities in developing a system
of regional and local hospitals and health centers covering all parts of the
country t
(2) Assurance of an adequate and well-distributed supply of physicians,
dentists, nurses, and other medical personnel .
PLANS FOR UNDERWRITING EMPLOYMENT
To guarantee the right to a job, activities in the provision of physical facilities
and service activities should be supplemented by
(1) Formal acceptance by the Federal Government of responsibility for
insuring jobs at decent pay to all those able to work regardless of whether or
not they can pass a means test ;
(2) The preparation of plans and programs, in addition to those recommended
under public works (II-B-3), for all kinds of socially useful work other than
construction, arranged according to the variety of abilities and location of
persons seeking employment'
1 From final report, NRPB, p. 18 .
2 Ibid., p. 17.
Page 17 :
PLANS FOR SOCIAL SECUBITY
Reorganization of the unemployment compensation laws to provide broad-
ened coverage, more nearly adequate payments, incorporating benefits to depend-
ents, payments of benefits for at least 26 weeks, and replacement of present
Federal-State system by a wholly Federal administrative organization and a
single national fund.
Creation of an adequate general public assistance system through Federal
Anancial aid for general relief available to the States on an equalizing basis
.and accompanied by Federal standards .
Strengthening of the special public assistance programs to provide more ade-
quately for those in need, and a redistribution of Federal aid to correspond to
-differences in needs and financial capacity among the States .
Page 69
EQUAL ACCESS TO EDUCATION
That equal access to general and specialized education be made available to
all youth of college and university age, according to their abilities and the
needs of society.
Page 70
That adequate provision be made for the part-time education of adults through
-expansion of services such as correspondence and class study, forums, educa-
tional broadcasting, and libraries and museums.
Page 71 :
That camp facilities be made available for all youth above the lower ele-
,mentary grades, with work experience provided as a part of camp life.
Page 72
That the services of the United States Office of Education and State depart-
rments of education be expanded and developed to provide adequate research
facilities and educational leadership to the Nation .
Page 73
That inequality of the tax burden for education within and among the States
be reduced through the distribution of State and Federal funds on the basis
of need .
The quotations from the reports of the National Planning Board
and the National Resources Planning Board should suffice to show
how they have followed the lead of the Commission on Social Studies
and how completely they have embraced virtually all phases of our
economic life including education .
It will be of interest and significance to trace the progress of one
who was undoubtedly a leader in the evolution of this influence as it has
been set forth. In this case, we refer to Mr . Charles E. Merriam and
in so doing we wish to have it thoroughly understood that we are
casting no aspersions on his name or memory .
The following statement regarding the origin of the Social Science
Research Council is found in the annual report of that organization
for 1928-29.
TAX-VM) ,T FPTNDATIONS 617
From page 39, appendix A
In 1921, the American Political Science Association- appointed a Committee on
Political Research, with Prof . Charles F . Merriam as chairman . The purpose
of this committee was to scrutinize the scope and method of research in the field
of government in order to obtain a clearer view of the actual situation and to
offer constructive suggestions .
In a preliminary report in December 1922, the following statement
appeared
That a sounder empirical method of research had to be achieved in political
science if it were to assist in the development of a scientific political control .
Quoting further the report said :
As one of its major recommendations, the committee urged "the establish-
ment of a Social Science Research Council consisting of two members each from
economics, sociology, political science, and history, for the purpose of
"(a) The development of research in the social studies .
"(b) The establishment of a central clearing house for projects of social inves-
tigation.
"(c) The encouragement of the establishment of institutes for social-science
study, with funds adequate for the execution of various research projects and
publications, in the various fields of science ."
The Social Science Research Council was formed in 1923 and incor-
porated in 1924 . Charles E . Merriam served as its president from
1924 to 1927 . He was president of the American Political Science
Association during 1924 and 1925, a member of the Hoover Commis-
sion on Social Trends and of the President's Commission on Adminis-
trative Management from 1933 to 1943 .
In 1926, a Committee of the American Historical Association made
a preliminary study and recommendation on the subject of social
studies in the schools . Mr . Merriam was a member of this committee
and later of the final commission on social studies whose report of May
1934 we have discussed at length .
In spite of his retention of membership, he with 3 others out of
the Committee of 14 members failed to sign the final report . Since
no dissenting report or advices are recorded, we can only guess at the
reason. In fairness to Mr . Merriam and from an examination of some
of his later writings on other matters, we are led to believe that he was
sufficiently opposed to the extreme revolutionary plans of Marxism
to disassociate himself from the more radical conclusions in this report .
Be that as it may, he retained his interest and activity in national
pTanning to the last . Following his connections with the American
Political Science Association, the Social Science Research Council,
and the American Historical Association, he was a member of the
National Planning Board in 1933-34 ; the National Resources Com-
mittee 1934-39 ; the National Resources Planning Board 1939-43 ; the
President's Committee on Administrative Management 1933-43 and
the United States Loyalty Review Board 1947-48 .
Mr. Merriam is the author of a book published in 1941 by the Har-
vard University Press, entitled "On the Agenda of Democracy ." This
book is composed of a series of lectures delivered by the author .

618 IrAx=EJEDt r V0!NPATioNS
The opening statement in the introduction follows (p . siii)

Foremost on the agenda of democracy is the reconsideration of the program
in the light of modern conditions . The old world is gone and will not return .
We face a new era, which searches all creeds, all forms, all programs of action ;
and spares none . Reason and science have made basic changes that demand
readjustment at many points . * * *
One of the chief tasks confronting democracy is the development of a program .
adequate to meet the changes of our time . * * *
Mr. Merriam defines planning as follows (p . 77)
Planning is an organized effort to utilize social intelligence in the determina-
tion of national policies.
The ensuing extracts from the pages indicated throw additional
light on Mr . Merriam's views (pp . 86-87)
From the organizational point of view the NRPB (National Resources Plan-
ning Board) is part of the Executive Office of the President . This includes the
White House Office, the Bureau of the Budget, the National Resources Planning
Board, the Office of Government Reports, the Liaison Office for Personnel Man-
agement, and the Office for Emergency Management . With the reference to other
Federal agencies outside of overhead management, the Board has endeavored to
encourage planning activities in the various departments of the Government.
There is now a Planning Division, specifically so-called, in the Department of
Agriculture.
There is one in the making (provided Congress gives an appropriation) in the
Federal Works Agency ; there is a general committee in the Department of the
Interior which is not called a planning committee but which may serve the same
purpose, and there are Planning Divisions in the War Department and in the
Navy Department . There are similar enterprises not labeled "planning" but
doing much the same work in a variety of other agencies, as, for example, in the
Treasury, in Commerce, in the Federal Reserve Board, and in other independent
agencies . The Board has endeavored to make a special connection with Federal
agencies through its various technical committees, dealing with particular topics
assigned by the President . These committees usually have representatives of
several Federal agencies, as, for example, the Committee on Long -Range Work.
and Relief Policies.
The Board (National Resources Planning Board) has also dealt with private
agencies interested in planning . The most notable example is its Science Com-
mittee . Here groups were brought together that never came together before,
namely, the National Academy of Sciences, the Social Science Research Coun-
cil, the American Council of Learned Societies, and the American Council on
Education with its 27 constituent organizations . The members of the sci-
ence committee are designated by these four groups . These scientists have
undertaken with the United States Government some very important studies,
notably the study of population, the study of the social implications of tech-
nology, and the study of research as a national asset-research in the National
Government, in private industry, and ultimately in the various local govern-
ments .
Pages 110-11 :
As a student of planning, I see the possibility of adapting our national resources
to our national needs in peace as well as in war, in the development of national
productivity and higher standards of living as a part of the same program .
This is the bill of rights in modern terms .
Page 113
It will be important to have a shelf of public work and projects ready fog
use, if there is need, available to combat any wide tendency toward general
unemployment .

TAX-EXEMPT; FOUNDATIONS 61.9

In another book called the New Democracy and the New Despotism,
Mr. Merriam states (pp . 58-59)
Out of the field of science and education emerged the body of inquiry, experi-
ment, and reflection known as social sciences . The developing range of knowl-
edge regarding the principles and techniques of social behavior tended to in-
crease human confidence in conscious social control . The tendency was not
merely to accept the environment as given, but to understand it, then to devise
appropriate methods and techniques for the guidance of social forces .
Page 148
My own preference is for a national planning board appointed by-the Execu-
tivee and responsible to him, serving on an indeterminate tenure . Such an organ-
ization might act as a long-time planning agency for the coordination of various
plans among departments or bureaus and for the elaboration of further lines
-of long-time national policy in the larger sense of the term .
All in all, the long record of Mr . Merriam in his participation in
the general field of the social sciences and in the governmental opera-
tions,, and the quoted excerpts from his writings should serve to iden-
tify him thoroughly with the policies and practices, the effects of which
are shown in the staff's report on economics and the public interest.
To emphasize the importance of the parts played by the specialists
from the field of education, it may be said that the staff has lists of
some of these consultants and advisers that total as follows : Depart-
ment of State, 42 ; Department of Denfense, 169 .
Before taking up the report on economics and the public interest,
it will be well to take a moment or two to close the triangle of relation-
ships among foundations, education and Government by reference to
the United States Office of Education . . It is the official center of con-
tact between the Government itselff and the outside educational world .
In table 7 of the Economic Report, it is shown that from 1945 to
1952 inclusive, the Federal Government has expended the total sum
of $14,405,000,000 on education in its various forms . Much, if not all,
of this is under the jurisdiction of the United States Office of Educa-
tion.
As part of this vast project, the Office itself issues many good book-
lets on various phases of education and collects many valuable statis-
tics on cost, attendance, and other matters of interest in this domain .
Among the booklets issued, by this agency are a few which may be
mentioned and identified .
They are
The U. N. Declaration of Human Rights : A handbook for teachers, Federal
Security Agency, Bulletin 1951, No. 12, Office of Education .
How Children Learn About Human . Rights : Place of subjects series, Bulletin
1951, No. 9, Federal Security Agency, Office of Education.
Higher Education in France : A handbook of information concerning curricula
available in each institution, Bulletin 1952, No . 6, Federal Security Agency, Office
of Education.
Education in Haiti : Bulletin 1948, No . 1, Federal Security Agency, United
States Office of Education.
This brief reference is purely factual and without appraisal or
comment.
It is made only as a matter of information for the consideration of
the committee when it considers the problems involved .

62x0 TAX-EXEMPT FOUNDATIONS
This is the conclusion of the report.

The CHAIRMAN . You are including the other parts in the record?
Mr. McNiEcFi Yes, the economics report is separate and I had
hoped' if the : time were available wee might read certain parts of that ;
but include the whole thing for the-record, avoiding the complications
and confusion and time involved in reading a, lot of, statistics which
are of value only for study .
The CHAIRMAN . The Rockefeller Foundation has given a total, in
excess of $4 million to the London School of Economics?
Mr. McNiEcr-Thut- is right,`:according to the record, as we have
compiled
CHAIRMAN . That is a lot of money . And the London School
of Economics is generally recognized as being liberal, with liberal in
quotations?
Mr . MCNnVDM Yes.
The CHAIRMAN. Or by some people referred to as leftist . Having
attended the London School of Economics for a time, that accounts
for my leftist leanings.
I
Mr. HAYS . I would say by the process we are going here that makes
you subversive . I don't really think you are but you could certainly
imply that, from some of the things. I am glad you brought that up,
because I had read this before, and I have listened carefully, and you
have put your finger on the only thing in this whole document that
has anything
anythingto do with foundations, that reference on page 9 . The
rest is airing somebody's political views .
Mr. iacNIEcF,. No.
The CHAIRMAN . No. The National Resources Planning Board, the,
way it was set up, it did tie into the foundation funds, did, it not?
. Mr., McNiEcF . Certainly, through the American Historical Asso,
ciation,' the 'Social Science Research :Council, the American Council
on Education, the aid of all of which is acknowledged in the official
reports of the National Resources Planning Board . It is stipulated by
them. That is a definite hookup with the foundations . -
Mr. HAYS. You say yourself they suggest that ; is that bad?
Mr. McNiEci& They have not the power of Congress to authorize
its adoption. -They have gone as far as they can .
Mr. RAYS . Now, you are getting some place . In-other words, none
of this has any validity or authority unless Congress decides to imple-
ment it .
Mr.` McNTEcE .' I have Suggested here in the preliminary statement
that the appropriations by Congress and the record of governmental
expenditures follow very closely the line of recommendations which
I just finished reading.
Mr. HAYS . Are you saying that Congress has a bunch of nitwits
and dupes or just-been subversive, or what?
Mr. WcNIECE. No ; I am not saying any such thing, and it should
not be inferred from any remark I have made .
The CHAIRMAN . My knowledge is just to the contrary .
Mr. HAYS . You seem to indicate that Congress was pushed into
this by the statement .you just made; that their appropriations' par-
alleled this and these people influenced them .
Mr. McNiEcE . Inferences are free to those who make them . I have
only stated the facts . I am making no inference beyond the state-
ment of facts .
0

SPECIAL COMMITTEE
TO

H. RES . 217
STAFF REPORT NO . 3
ECONOMICS AND THE PUBLIC INTEREST
May 1954
Prepared by Thomas M . McNiece, Assistant Research Director
UNITED STATES

SPECIAL COMMITTEE, TO INVESTIGATE TAX-EXEMPT FOUNDATIONS

B. CARROLL REECE, Tennessee, Chairman
JESSE P . WOLCOTT, Michigan WAYNE L . HAYS, Ohio
ARNOLD KocH, Associate Counsel
JOHN MARSHALL, Jr., Chief Clerk
THOMAS McNIEcE, Assistant Research Director
11


PREFACE
Over the past 50 years sweeping changes have occurred in this country in the
functions and activities of the Federal Government . Some of these changes are
to be expected as a result of increasing population, industrial, and commercial
growth and our greater participation in world affairs .
By no means have all of the changes resulted from the foregoing causes . On
the contrary other deviations have occurred which are totally unrelated to chang-
ing requirements of Government and which in fact have not been considered as
functions of Government under our Constitution and its enumerated powers .
Among these is the increasing participation of the Federal Government in edu-
cation, slum clearance, nutrition and health, power generation, subsidization of
agriculture, scientific research, wage control, mortgage insurance, and other activ-
ities . Most if not all of these were politically conceived and depression born .
They represent new ventures in our Federal Government's activities.
Most, if not all of these newer activities of Government are recommended in
one place or another in publications of socially minded committees of Govern-
ment and of reports by various educational groups, social science and others,
supported by foundation grants .
They are so foreign to the conception of our Government of enumerated pow-
ers as we have known it under the Constitution, that the departure has been
referred to as a "revolution" by one of its proponents who will be quoted later .
While the groundwork for these changes has been underway for a long time,
the real acceleration of progress toward these objectives began about 20 years
ago. Since then, the movement has grown apace with little or no sign of slow-
ing down.
The word "revolution" is commonly associated with a physical conflict or
development of some sort accompanied by publicity that marks its progress one
way or another. Not all revolutions are accomplished in this manner .
The lower the social stratum in which a revolution originates, the noisier
it is likely to be . On the contrary a revolution planned in higher circles by some
segment of people at policymaking levels may be very far advanced toward
successful accomplishment before the general public is aware of it .
A plan may be formulated with some objective in mind, agreement reached,
organization effected, and action begun initially with a minimum of publicity .
Such a program has been in progress in this country for years . Originally, the
thought of such a revolutionary change was probably confined to very few peo-
ple-the organizers of the movement . With the passage of time and under the
Influence of the growing emphasis on the so-called social sciences, the Federal
Government began to push forward into areas of activity formerly occupied by
State and local government and private enterprise .
As an indication of this trend, a statement may be quoted from regional
planning, a report issued by the National Resources Committee in June 1938.
"More than 70 Federal agencies have found regional organization necessary
and there are over 108 different ways in which the country has been organized
for the efficient administration of Federal services ."
Arrangements of this type facilitate the gradual expansion of governmental
action and control through executive directives as distinguished from specific
legislative authorization.
Much of this planning was done with the aid of social scientists in Govern-
ment employ and of outside individuals or groups with similar Ideas and ob-
jectives . Many of these were directly or indirectly connected with educational
organizations who have and still are receiving very substantial aid from the
large foundations .
Some of these activities were undertaken under the guise of temporary aid
during depression but they have been continued on an increasing scale as will
be shown In the ensuing report .
Evidence indicates that a relatively large percentage of foundation giving
was originally in the form of grants to endowment funds of educational insti-
tutions . There has been a sizable shift in later years from grants for endow-
ment to grants for specific purposes or objectives but still through educational
channels .
As far as the economic influence on Government is concerned, the resnlts
were manifested first through the planning agencies. The recommendations :
made by these groups finally evolved into more or less routine matters in which
Congress is now asked to approve each year a series of appropriations to cover
the cost . These various classes of expenditures are listed and discussed in the
ensuing report . Charts are included at the end . In a number of cases, trends
are shown for the greater part of this century .
It should be understood that not everyone who has assisted in furthering these
objectives is guilty of conscious participation in questionable action . Those who
have studied these developments know that many well-meaning people have
been drawn into the activities without knowledge of understanding of the final
objectives . A well-organized central core of administrators with a large num-
ber of uninformed followers is standard practice in such organized effort .
ECONOMICS AND-THE PUBLIC INTEREST
INTRODUCTION
This report is made for the purpose of showing the nature and increasing costs
of governmental participation in economic and welfare activities of the Nation.
These were formerly considered as foreign to the responsibilities, particularly
of the Federal Government .
The nature of these recent activities is briefly described and data shown in
tables 1 to 8 . The results are shown annually in these tables since 1948 in order
to indicate the generally increasing trends in recent years .
Tables 9 to 16 and charts 1 to 12, together with the accompanying data sheets
from which the charts are constructed, afford some measure, both volumetric
and financial, of the effect these activities have had on national debt, taxes, and
personal income of the people .
Finally, the conclusion is drawn that the financial integrity of the Nation
will be jeopardized by a continuation of the policies which may be ineffective
in the end as far as their stated objectives are concerned .
INDEX OF TABLES
Table 1 . New permanent housing units started in nonfarm areas .
Table 2. Federal contracts awards for new construction .
Table 3 . Federal food programs .
Table 4. Federal expenditures for promotion of public health .
Table 5 . Federal expenditures for social security and health .
Table 6 . Federal expenditures for vocational education .
Table 7. Federal educational expenditures .
Table 8. Federal funds allotted for education for school year 1951 .
Table 9. Government civilian employees per 1,000 United States population .
Table 10. Government civilian employees versus other civilian employees .
Table 11 . Departments and agencies in the executive branch .
Table 12. Ordinary Federal receipts and expenditures .
Table 13 . Comparative increases in taxes and population-excluding social se-
curity taxes .
Table 14. National income versus total Federal, State and local taxes .
Table 15 . National income and national debt per family .
Table 16 . Comparative debt and income per family .
Table 17 . Gross national product and national debt .
Table 18 . Gross national product, Federal debt and disposable personal income .
Table 19 . Percentage of gross national product-Personal versus governmental
purchases .
Table 20. Price decline 8 years after war .
REVOLUTION
In the 20 years between 1933 and 1953, the politicians, college professors, and
lawyers, with little help from business, wrought a revolution in the economic
policies of the United States . They repudiated laissez-faire. They saw the
simple fact that if capitalism were to survive, Government must take some
responsibility for developing the Nation's resources, putting a floor under spend-
ing, achieving a more equitable distribution of income and protecting the weak
against the strong . The price of continuing the free society was to be limited
intervention by Government . [Italics added.]
The foregoing statement is the opening paragraph in an article by a Harvard
professor (Seymour E . Harris, professor of economics, Harvard University in
the Progressive, December 1953) as printed in a recent issue of a magazine and
as included in the appendix of the Congressional Record of February 15, 1954 .
It is a very broad and emphatic statement . Numerically, the "politicans, college
professors, and lawyers" comprise a very minute percentage of the total popula-
tion of the country-a minute percentage of the people who, under, the Constitu-
tion are responsible for effecting "revolutionary" changes in governmental prac-
tice. Certainly these changes as enumerated have never been submitted to nor
ratified as such by the people or their duly elected representatives .
Rvolution accomplished : How then could a departure so drastic as to be
called a "revolution" be accomplished?
Normally a revolution is not accomplished without a considerable measure of
publicity attained through fuss and fireworks that attend such efforts . In the
absence of such developments, it could only be achieved through carefully coor-
dinated effort by a relatively small group centered at policy making levels .
In connection with this latter throught, it is interesting to compare the state-
ment quoted in the first paragraph with the five points for Federal action
enumerated shortly hereafter .
Evidence of such changes in Federal policy, their direction and effect will
be submitted later, but it will be first in order to mention that the Federal Gov-
ernment is a government of enumerated powers . Certainly the powers enum-
erate do not mention the "development of the Nation's resources, putting a floor
under spending, achieving a more equitable distribution of income and pro-
tecting the weak against the strong ." Neither has the Government itself prior
to the period mentioned in the opening paragraph, assumed such rights and
responsibilities .
These and other changes which have been effected are revolutionary . They
have been accomplished not openly but indirectly and without the full knowl-
edge, and understanding of the people most affected .
Subversion : In fact, the methods used suggest a form of subversion . Sub-
version may be defined as the act of changing or overthrowing such things as
the form or purpose of government, religion, or morality by concealed or insidi-
ous methods that tend to undermine its supports or weaken its foundations.
Public interest : It may be said by the proponents of such procedure that
it is warranted by the "public interest ." Public interest is difficult to define but
for the purpose of this study, we can probably do no better than to refer to
the preamble of the Constitution of the United States wherein it is stated that
the Constitution is established-
"in order to form a more perfect union, establish justice, insure domestic
tranquility, provide for the common defense, promote the general welfare, and
secure the blessings of liberty to ourselves and our posterity ."
The last three words in the foregoing quotation impose a responsibility for
the future upon us of the present . A risk for the future is implicit in some
of the measures advanced for the advantage of the present and such measures
may be said to be subversive, un-American and contrary to the public interest .
To subvert or circumvent the Constitution or to change authorized procedure
under its provisions by other than the methods established by the Constitution
itself may with certainty be called un-American . The Constitution is not a
static or dead document . It has been amended with reasonable frequency and
can always be modified if a real need for change develops .
Methods of procedure : Mr . A . A . Berle, Jr ., formerly Assistant Secretary
of State and one of the active proponents of increased governmental participa-
tion in economic life made the suggestion that the Federal Government supply
cash or credit for the following purposes after World War II (The New Phi-
losophy of Public Debt by Harold G . Moulton, the Brookings Institution, Wash-
ington, D . C .) .
(1) An urban reconstruction program .
(2) A program of public works along conventional lines.
(3) A program of rehousing on a very large scale .
(4) A program of nutrition for about 40 percent of our population .
(5) A program of public health .
Progress toward objectives : It will be informative to record a few measures
of progress toward the objectives that focus so sharply on paternalism and
socialism in government .
This Nation has attained a standard of living that is higher and more widely
distributed than that reached by any other nation in history . It has been
accomplished in a very short span of years as compared with the lives of other
nations and it is still increasing . Impatience and envy unrestrained may con-
ceivably wreck the future for the sake of the present . The possibilities of this
are indicated in factual evidence of today . The public interest will not be
served thereby.
(1) An urban reconstruction program : (e) A program of rehousing on a

very elaborate scale : It is difficult to differentiate clearly between items 1 and
3 and such data as are available will pertain largely to both .
TABLE 1 . New permanent housing units started in nonfarm areas publicly owned'
Number
Period
Total Average per
year
1935-39 87,000 17,400

1940-44 224,800 44 .960
1945-49 67,000 13,400
1950-52 173,500 57,833
Total 532,300 30,000
I Data from Supplement to Economic Indicators .

Data are not available on the total value involved in this increasing scale of
public construction . Neither do the available data indicate the division of cost
between local, State, and Federal Governments .
On February 27, 1954, the Housing and Home Finance Agency reported that
there were 154 slum clearance projects underway in January 1954 compared
with 99 at the beginning of 1953 . This is an increase of 56 percent in number
during the year .'
These tabular statements should be sufficient to indicate planned action in
conformity with the suggestions involved in items 1 and 3 . There are no data
available that show any such Federal activities prior to 1935 .
(2) A program of public works along conventional lines : The following table
shows the value of Federal contracts awarded for new construction . It is not
possible from the information available to determine the real proportion of cost
furnished by the Federal Government . The fact that the work is covered by
Federal contracts suggests that Federal participation is an important percentage
of the total which also includes whatever proportion is furnished by owners,
whoever they may be .
TABLE 2 . Federal contract awards for new construction'
1935 $1,478,073,000 1949 $2,174,203,000
1940 2, 316, 467, 000 1950 2, 805, 214, 000
1945 1, 092, 181,000 1951 4, 201, 939, 000
1948 1, 906, 466, 000 1952 4, 420, 908,000
Regardless of the degree of Federal participation in this work, the rising trend,
even in years of high economic output, is obvious .
A less pronounced trend but a large volume of expenditure is shown in the
following data .
Federal expenditures for public works'
1952 (actual) $3,116,000,000
1953 (estimate) 3,419,000,000
1 Statistical Abstract of the United States, 1953 .
These data are sufficient to indicate the possibility, if not probability, of spend-
ing for public works on a grandiose scale . The fact that such spending would
be accelerated when economic activity and governmental income are low would
mean drastic increases in public debt which is now at extreme and dangerous
levels. It is significant that the debt has not been reduced but is increasing even
at the continuing high level of tax collections .
It is also well to remember that the cost of .public works does not cease with
the completion of the works. On the contrary, increased aald continuing costs
are sustained for operation and maintenance of the additional facilities . This
is not to condemn or disapprove of reasonable and required expenditures to meet
the normally growing needs of our increasing population .
1 New York Times, Feb. 28, 1954 .
(4) A program of nutrition : The suggestion for a Federal program of nutri-
tion implied that about 40 percent of our population should be the beneficiaries
of such a plan. It is scarcely conceivable that any such proportion of our people
are or have been undernourished .
The Federal Government since 1936 has been participating in food distribution
to institutions and welfare cases as well as to school-lunch programs . From
1936 to 1952, inclusive, the cost of these programs has been as follows
TABLE 3.Federal food program'
Institutional and welfare cases (direct distribution) $306,090,000
School-lunch programs (direct distribution) 290,330,000
School-lunch programs (indemnity plan) 498,909, 000
Total 1 9 095, 329, 000
I Statistical Abstract of the United States, 1953 .
(5) A program of public health : It was announced by the United States Pub-
lic Health Service that in October 1952, the one-thousandth hospital had been
completed under the Hospital and Construction Act. Since 1946, the Federal
Government has contributed $500 million to this program . The Health Service
announced that it had 800 additional projects underway or planned as of 1952 .
State and local governments have contributed about twice as much toward this
work as the Federal Government.
The record of Federal budgetary expenditures for promotion of public health
shows the following expenditures for the years indicated.
TABLE 4
1945 $186,000,000 1950 242,000,000
1946 173,000,000 1951 304,000,000
1947 146,000,000 1952 328, 000,000
1948 139,000,000
1949 171,000,000 Total 1, 689, 000,000
At intervals, agitation is repeatedly renewed on the subject of publicly financed
medical care .
Benefits under the various forms of social insurance and public assistance pro-
grams are increasing rapidly from year to year . Total payments made by Fed-
eral and State Governments are indicated herewith .
TABLE 5.-Federal expenditures for social security and health' (excluding ex-
penditures from promotion of public health as previously shown)
1945 $802,000, COO 1949 1,672,000,000
1.946 821,000,000 1950 1,900,000,000
1947 1,117,000,000 1951 1,992,000,000
1948 1,667,000,000 1952 2,163,000,000
' Statistical Abstract of the United States, 1953 (p . 343) .
Education : A program of Federal contributions to education was not included
in the five classifications just previously discussed . Such participation has oc-
curred and in some groups in rapidly increasing amounts .
Federal aid in vocational education includes expenditures in agricultural trade
and industrial pursuits and in home economics and to some extent has been
granted over a period of 30 years or more . The following totals apply to the
years indicated
TABLE 6 . Federal expenditures for vocational education'
1936 $9,749,00011948 26,200,000
1940 20, 004, 000 1950 26,623,000
1944 19,958,000 1951 26,685,000
' Statistical Abstract of the United States . 1953 (p . 135) .
Two other classes of educational expenditures are made by the Federal Govern-
ment, one the large payments for the education of veterans which is now decreas-
ing and the other much small but increasing expenditures for general education
and research. These data are shown herewith
TABLE 7 .Federal educational expenditures'

[In millions]
Veterans' General Total

education purpose
1945 -------------- $158

1946 $351 85 436
1941 2,122 66 2,188
1948 2,506 65 2,571
1949 2,703 75 2,778
1950 2,596 123 2,719
1951 1,943 115 2,059
1952 1,326 171 1 .497
Total 13,547 858 14,405 •
I Statistical Abstract of the United States, 1953 (p . 343) .
Under the limitations of the law, the cost of veterans' education should con-
tinue to decline rapidly. If another war should ensue and the GI bill of rights
be taken as a precedent, the cost of veterans' education would become a tre-
mendous economic burden on the country . The former bill was passed without
any consideration of the capacity of the educational system to absorb the greatly
increased number of students. Chaotic conditions due to crowding existed in
many educational institutions .
Still another form of tabulation of educational funds made available by the
Federal Government is of interest. It pertains to funds allotted for 1951 and
includes those made available to agricultural experiment stations and Coopera-
tive Agricultural Extensions Service .
TABLE 8 .-Federal funds allotted for education for school year 1951'
Administered by
Federal Security Agency $171,720,000
Department of Agriculture 161, 658, 000
Veterans' Administration 2, 120, 216, 000 •
Other 97, 049, 000'
Total 2, 550, 643, 000,
1 Statistical Abstract of the United States, 1953 (p . 137) .
The trend of Federal educational expenditures, aside from those made for
veterans' education is unquestionably upward . That further increases are urged,
especially by those in the educational field, is illustrated by the following extract
from the discussion by Alvin H . Hansen, Professor of Political Economy, Harvard
University, before the meeting of the joint committee of the Senate and House
on the President's economic report . This meeting was held on February 18, 1954.
The quotation follows :
"There is no recognition of the fact, well known to everyone who has studied
State and local finance, that the poorer States which contain nearly half of our
children fall far short of decent educational standards ; yet they spend more on
education in relation to total income of their citizens than do the wealthier
States. For this situation there is no solution except Federal Aid ."
General comments : The foregoing evidence and discussion have been pre-
sented in an effort to show why the statement of revolution accomplished seems
to be supported by the facts . That a continuation of the policies is probable
seems apparent from the statistical trends as presented .
Quite regardless of the real propriety of this great and revolutionary departure
from our former constitutional principles of government, a serious question
must be raised about its effect on the future life of the Nation . Most of these
new Federal objectives of expenditure have hitherto been accepted as lying with-
in the province of the State and local governments. It is of course absurd to
assume that aside from the printing press, the Federal Government has access
to any greater supply of funds than exists within the States themselves . And
yet greater funds are necessary when the Federal Government embarks upon
all of these security and welfare activities . Each new or increased channel of
expenditure calls for additional bureaucratic control without any diminution of
similar control by State and local governments . In fact, as will be shown the
very conditions of distribution imposed by the Federal Government are appar-
ently causing some similar increases in State and local governmental costs.
The tremendously high level of taxes and debt and the pressure for still higher
debt limits and greater expenditures should convince any thoughtful and under-
standing people that danger is in the offing, that the public interest is not being
well served, but on the contrary is being placed in jeopardy. Our obligation to
posterity is apparently submerged in our sea of current self-interest .
The following discussion, with the aid of data and charts will show in both
physical and financial terms the increasing burdens imposed on the populace by
these governmental policies originating during the past twenty years .
Civilian employees in Government : The ensuing table shows the drastic
increases in governmental civilian employes that have occurred since 1930 . The
peak was encountered in 1945 from which time there was a gradual reduction
to 1948 . Note the level of stability attained in 1948, 1949, and 1950 at 280 percent
of the 1930 figure .
TABLE 9.-Government civilian employee per 1,000 United States population
Percentage of 1929
Federal State and Total
local
Federal State and Total
local
1930 5.0 21 .3 26 .3 102 102 102

1940 8 .2 24 .3 32 .5 168 117 127
1945 25.5 22 .4 46 .8 520 108 182
1948 14.1 25 .8 39 .9 288 124 155
1949 14.1 26 .5 40.6 288 127 158
1950 13.8 27 .1 40 .9 282 130 159
1951 16.0 26.7 42.7 327 128 165
1952 16.6 26.9 43.5 339 129 169
1953 16.2 27.2 43.4 331 131 169
Note that Federal civilian employees are now over three times as numerous
in proportion to the total population as they were in 1929 while State and
lccal employees are about one-third greater . For government as a whole, the
civilian employees per capita of total population have increased nearly 70 per-
cent over those of 1929.
These trends are shown graphically on charts 1 and 2 and the supporting
data as they exist for the period from 1900 to 1953 on the accompanying data
sheet 1 .
Because governmental employees have no part in the production of eco-
nomic goods and on the contrary must be supported by those who do, it will
be informative to show the comparison between governmental civilian employees
and the nongovernmental labor force. This comparison is shown in table 10
herewith
TABLE 10.-Government civilian employees versus other civilian employees
Government civilian .em-
ployees per 100 other em.
Total gov- Other than ployees
ernment government
Actual Percent of
1929
Millions Millions
1930 3.15 46.1 6.7 100
1940----- 4.19 51 .4 8.2 122
1945 5.97 47.9 12.5 187
1950 5.99 57.1 10.5 157
1951 6.37 56.5 11 .3 169
1952 6.63 56.4 11 .8 176
1953 6.67 56.7 11 .8 176
54609-54-2
These data show that as of 1953 there were virtually 12 Government employees
for every 100 other .workers, excluding all military forces . The increase since
11930 has been 76 percent . From the economic standpoint a parasitic load of 12
employees for every 100 others is quite a burden to bear .
The military forces of the United States have purposely been omitted from
consideration in the two foregoing tables. It is of interest to note, however,
that the inclusion of these military forces for the years 1951 and 1952 respectively
would show 16 .7 and 18.2 total governmental employees that must be supported
by each 100 other workers in the United States. Indeed a heavy load .
Trends for all years from 1929 to 1953 are shown on chart 3 and in the accom-
panying data sheet 2 .
It should be noted that the trends for the years 1948-53 shown on charts 1, 2,
and 3 are continuations of the upward trends which began in the early 1930's
and show no indication of change . Here in physical rather than financial terms
is evidence of the "revolution" mentioned in the beginning of this report . This
observation will be confirmed by still another instance of expansion measured
by the increase in the number of departments and agencies in the executive
branch of the Federal Government . These data apply only to major groups and
not to their recognized subdivisions or components .
TABLE 11.Departments and agencies in the executive branch
1926 31 1930 37 1952 69
1927 31 1940 47 1953 69
1928 31 1950 61
1929 31 1951 69
The data which follow will measure the increased operations in financial terms .
Federal receipts and expenditures : The ensuing as well as the foregoing
data are shown upon a per capita basis rather than in totals only as it is to be
expected that total expenditures and taxes will normally rise as the population
Increases. An increase on a per capita basis calls for analysis and explanation.
In the following table a comparison is shown on both a total and a per capita
basis between Federal receipts and expenditures . The term "receipts" naturally
Includes income from all forms of taxation including income, capital gains,
excises, customs, etc.
TABLE 12.-Ordinary Federal receipts and expenditures
In billions Revenue Expenditures
per per
Revenue Expenditures capita capita
1930 $4.178 $3.440 $33 .90 $27 .95

1940 5.265 9.183 40 .00 69 .60
1945 44.762 98 .703 320.50 706 .80
1948 42.211 33.791 288 .00 231 .00
1949 38.246 40.057 256 .50 268 .20
1960 37.045 40.167 245 .00 265.00
1951 48.143 44.633 311 .80 289.00
1952 62.129 66.145 396 .00 421 .00
1953 65.218 74.607 410 .00 466 .50
These data in per capital trends since 1900 are shown graphically on chart 4
As in the prior tables, there is no evidence of a declining trend in the actual
data .
Federal, State, and local taxes : Further light is thrown on tax trends by com-
paring increases in population and taxes since 1930. This information is given
in table 13.
TABLE 13.-Comparative increases in taxes and population excluding social
security taxes 1
[In millions]
Percentage of 1929
Population Federal State and
taxes local taxes Federal State and
Population taxes local taxes
1930 123 .1 $3,517 $6,798 101.2 105.1 105.7

1940 131 .8 4,921 7,997 108.5 147.6 124.4
1945 139 .6 40,989 9,193 115 .0 1,228.0 143.0
1948 146 .6 37,636 13,342 120.7 1,129.0 207.5
1949 149 .1 35,590 14,790 122 .1 1,066.0 230.0
1950 151 .1 34,955 15,914 124 .4 1,049.0 247.5
1951 154 .4 46,984 17,654 127 .0 1,378.0 273.0
1952 157 .0 59,535 -------------- 129 .1 1,785 .0 --------------
1953 159 .7 62,656 -------------- 131 .3 1,878 .0 --------------
1 Except portion used for administrative social security costs .
Maximum activity in the Korean war occurred in 1952 and in World War II
In 1945 . Despite the relatively smaller operation represented by the Korean
war, Federal taxes in 1952 were 45 percent greater than in 1945 . In the mean-
time the Federal debt has not been decreased but is rising and pressure for
higher debt limit has not been removed . The reasons for some of this great
increase have been indicated in the prior tables .
Annual data including those shown in table 13 for the period from 1 .916 to
1951 are given in data sheet 3 and are shown graphically on chart 5 . The strik-
ing comparison between the increases of Federal taxation and of State and
local taxation and of both in comparison with the increase of population justi-
fies some comment on the difference . Obviously State and local taxation by
1951 had increased 173 percent since 1929 while population has increased but
54 percent.
Federal taxation in the same time has increased 1,278 percent or nearly 13
times with no decrease in Federal debt and strong prospects of further increase .
The prstwar trend merely continues that established before World War II,
although it is of course higher than it would have been had the war not occurred .
On the other hand tables 9 and 10 and charts 1, 2 and 3 indicate conclusively
that civilian employees in Government show an increasing trend, particularly in
the Federal Government since the early thirties . This measure is quite inde-
pendent of continuing financial increases due to costs introduced by war .
It seems natural to assume that real "welfare" needs should be most apparent
in the localities where they exist and that State and local taxes would show
a responsive trend. The fact that such "on-the-spot" trends are but a fraction
of the Federal trends may indicate the correctness of the early statement that
the revolution "could only be achieved through carefully coordinated effort
by a relatively small . group centered at policy making levels," a group possibly
composed of "politicians, college professors and lawyers" as quoted in the first
paragraph . The comparison also warrants the inference that local control
of spending and taxes is more effective than remote control which impairs both
knowledge and understanding .
Taxes as a percentage of national income : It will be of informative value
to show the trend of taxes as a percentage of national income which provides
the fund out of which taxes must be paid . The following table for the years
shown will indicate such percentage and the trend .
TABLE 14.-National income versus total Federal, State, and local taxes in
billions by calendar years
National Taxes as
income Total taxes percent of
income
1929 $87.4 $10.30 11 .8

1930 75 .0 9 .77 13 .0
1940 81 .3 16 .95 20 .9
1945 182 .7 52.52' 28 .7
1948 223 .5 58.10 26 .0
1949 216 .3 54.93 25.4
1950 250 .6 67 .75 28 .2
1951 278 .4 84 .56 30 .4
Taxes as a percent of national income increased from 11 .8 in 1929 to 30 .4 in

1951. In other words, the tax bite took 18.6 cents or 158 percent more out of
the income dollar in 1951 than it did in 1929, a prosperous though shaky year .
This is another illustration of the effect on private income caused by the ex-
panding activities of Government .
Government debt and national income : It might be expected that the increas-
ing percentage of national income that is taken in taxes would result in some
reduction of the national debt. It is now 8 1/2 years since the close of World
War II . Taxes have been increasing but so has the debt which is now push-
ing through its legal ceiling . The difficulty in visualizing the relationships
between debt, income, and population when all are changing makes it advis-
able to express income and debt in terms of the population . This has been done
in the following table wherein both are expressed in terms of the family as
a unit because it has more personal significance than a per capita basis .
TABLE 15 .National income and national debt per family
National Number National Federal

income families income per debt per
(billions) (millions) family family
1929 $87.4 29.40 $2,972 $576

1930 75.0 29.90 2,510 542
1940 81.3 34.95 2,325 1,230
1945 182.7 37.50 4,870 6,900
1948 223 .5 40.72 5,490 6,200
1949 216 .3 42.11 5,140 6,000
1950 240.6 43.47 5,530 5,930
1951 278.4 44.56 6,250 5,750
1952 291.6 45.46 6,415 5,700
1953 1 306.0 47.50 6,440 5, coo
1 Estimated .
National income per family increased 250 percent in current dollars while
the Federal debt per family increased 855 percent .
The foregoing data in decennial terms from 1900 to 1930 and in annual terms
from 1929 to 1953 are shown on data sheet 6 and income and debt per family
on chart 7.
The amount of debt overhanging a nation has a tremendous influence on that
nation's solvency and therefore its stability under impact caused either by eco-
nomic depression or additional forced expenditures to relieve depression or to
prosecute another war . It has been stated many times that we as a Nation were
in a vulnerable debt or credit condition when the collapse began in 1929. It will
therefore be interesting to compare the conditions of 1929 with those of the
present and of the time intervening.
Again, the comparisons will be upon a per-family basis and will show the
changes in total private debt including corporate debt and total public debt
compared with national income per family . The data follow in the next table
TABLE 16 .-Comparative debt and income per family
Private Total public National
debt and private income
debt per family
1929 $5,500 $6,500 $2,972

1930 5,380 6,400 2,510
1940 3,700 5,460 2,325
1945 3,755 10,860 4,870
1948 4,975 10,690 5,490
1949 4,985 10,600 5,140
1950 5,670 11,180 5,630
1951 + 6,230 11,650 6,250
While the total debt per family has nearly doubled, national income has some-
what more than kept pace with it . The disturbing factor from the standpoint
of Federal financial stability is the fact that in the interval from 1929 to 1951,
the Federal proportion of the total debt has increased from 15 to 46 .5 percent.
The foregoing data in annual terms from 1929 to 1951 are given in data sheet
7 while the trends of private debt and total debt are shown on chart 8 .
Gross national product : It is contended by some that internal Federal debt is
of little importance and that no attempt should be made to place a ceiling upon
it . Rather is it argued that an increase in public debt will be a needed stimulant
to keep national production in step with our expanding population . It has also
been argued as a part of this philosophy that the only safeguarding thing to
watch is the ratio between national debt and gross national product and that
the ratio now existing will provide a safe guide in such control . It will be of
value to examine these factors in the light of these claims .
Gross national product may be defined as the total value of all goods and
services produced in a period of time and usually valued in terms of current
prices . It does not include allowances for capital consumption such as depletion,
depreciation, and certain other adjustments. Efforts have been made to compute
the value of gross national product at intervals over many years past . Gross
national product has been tabulated for each year since 1929 . The comparative
data on gross national product and national debt are shown in table 17 .
TABLE 17.-Gross national product and national debt values in billions
Gross na- Gross na-
tional prod- tional prod-
uct at cur- Federal debt uct at 1929
rent prices prices I
1929 $103 .8 $16 .9 $103 .8

1930 90 .9 16.2 93.4
1940 101 .4 48 .5 124.0
1945 215.2 269 . 1 205.0'
1948 259 .0 252 .4 184 .6
1949 258 .2 252 .8 186.0
1950 286.8 257.4 205 .2
1951 329 .8 255 .3 217.0-
1952 348.0 259 .2 223.5
5953 2366.0 266 .1 234.0
1 Consumer's prices .
2 Estimated.
.638 TAX-EXEMPT FOUNDATIONS
At current prices, gross national product increased 252 percent between 1929
and 1953 but at constant prices the increase was 125 percent . In the same
interval Federal debt increased 1475 percent in current prices . It is this in-
crease in Federal debt which in this recent philosophy is of no practical sig-
nificance . The measure of control under this theory is the ratio between debt
and gross national product .
Data in the foregoing table are shown from 1900 to date in data sheet 8-
trend values only for 1900 to 1920 . This information is shown in chart form
on Chart 9. The dotted line shows what gross national product would have
been at constant prices, in this case at consumers' prices of 1929, a year of high-
level production. The lightly shaded area between the adjusted and unad-
justed values after 1943 shows the inflationary spread due to postwar rising
prices or in other words to the increased cost of living . A still greater area
of inflation must be expected if the dollar is weakened by increasing Federal
expenditures and debt .
Ratio of Federal debt to gross national product : Since, as has been previously
mentioned, the ratio between Federal debt and gross national product has been
:suggested as an effective measure of control in the prevention of excessive debt,
i t will be well to observe the values of this ratio for a period of time embracing
widely varying conditions in our national economy .
It will also be informative to show the effect of these policies of great Federal
.expenditure and high taxes on citizens' personal income after taxes as it relates
to gross national product . This latter division of income is known as dispos-
-able personal income and together with its ratio to gross national product is
:shown in the following table
TABLE 18 .-Gross national product, Federal debt and disposable personal income
[Values in billions of current dollars]
Percent
Percert lisposable
Disposable Federal personal
National Federal personal debt, gross income,
product debt income national gross
product national
product
1929 $103 8 $16.9 $82.5 16 3 79.4

1930 90.9 16 2 73 7 17.8 81 .0
NO 101 .4 48 5 75 .7 47.8 74.7
1945 215 2 259 1 151 .1 120.5 70.2
1948 259.C 252 4 188.4 97.5 72.7
1919 258.2 252 8 187.2 97.9 72 .5
1950 286 8 257.4 205.8 89 8 76.7
1951 329 .8 255 3 225.0 77.5 68 .2
1952 348 0 259.2 235.0 74.5 67 .5
1953 1 366 .0 266.1 250.0 72.7 68 .3
I Estimated.
It is apparent from the data that Federal debt increased from 16 percent
of gross national product in 1929 to 73 percent in 1953 . In the same period
the citizens' share of their own income available for their own purposes de-
clined from 79 to 68 percent of gross national product . This declining per-
centage of gross national product left to the consumer himself will be par-
ticularly noticeable when business volume declines to a more nearly normal
level . This sacrifice has been made without any reduction in the total debt
leveL This is due largely to the Federal Government's increasing participation
in what might be termed extracurricular activities based upon the conception
of government defined in the Constitution and previously followed during our
unprecedented rise in economic status .
The data in table 18 are shown in extended form since 1900 in data sheet 9
and on chart 10 . The chart clearly indicates the tremendous change that has
occurred in this ratio between Federal debt and gross national product . From
1900 to 1916 there was a steady decline in the ratio which averaged only 4 .4
percent for the period . This means that the citizen was realizing a larger and
larger percentage of his earnings for his own needs and desires .
The effect of debt arising in World War I is apparent in the increased ratio,
but following the peak in 1921 there was a gradual decline to 16 .3 percent in
1929 when the upward climb began again . Beginning in 1948, 3 years after the
end of World War II and 2 years before the Korean war, the Federal debt again
began to climb .
The decline in ratio since 1948 is caused entirely by the abnormally high output
of economic goods in terms of both volume and price and not by a decline in the
debt level . This distinction is important . Gross national product is the arith-
metical product of price multiplied' by physical volume . Physical volume lately
has been abnormally high because extensive military rearmament has been
underway since World War II, not only for ourselves but for other nations .
- Physical volume was also increased by certain relief measures and military
aid for other countries and production to meet domestic demand deferred by
World War II . In addition, prices have risen 49 percent since 1945. The point
to be emphasized is that the physical volume of output for the period since 1940
has been abnormally high due to production for war and its waste and for demand
deferred from wartime . Without another' war we cannot hope to maintain this
physical output regardless of what happens to prices and it should not be con-
sidered a function of Government to try it .
Disposable personal income : The citizen's reduced share of his own personal
income as a percentage of the goods and services he creates is also portrayed
on chart 10. The declining trend shown in table 18 is clearly defined on the
chart . The trend was even more sharply downward prior to 1943 when wartime
output increased greatly and to be continued, as previously mentioned, by renewed
abnormal production for military purposes and deferred civilian demand .
The larger the share of production and its value absorbed by Government,
the less the citizen has for his own choice of expenditures . The following data
are taken from the Economic Report of the President for 1954 .
TABLE 19 .Percentage of gross national product, personal versus governmental
purchases
Personal Total Gov-

Year consumption ernment
expenditure purchases
Percent Percent
1930 78 . 0 10.1
1947 ` 71.0 12.3
1948 68.7 14.1
1949 69.9 16.9
1950 67.9 14.6
1951 63.1 19.1
1952 62.7 22.3
1953 62.6 22.7
1
1 Estimates.
Here indeed in the declining share of his own output that is allotted to him
is one result of the revolution at work .
The extraordinary expenditures of Government beginning in the early thirties
are continuing with increasing volume.
Changes in post war policies :' Changes in governmental policy with respect
to expanding participation in and control of our economic activities has been
repeatedly emphasized in this study . Further light on these policies and their
effect may be shown by reference to the long-term history of prices in this
country. On chart 11, the trend of wholesale commodity prices' in terms of
1910-14 as 100 percent are charted . Two outstanding features of this long-term
trend are obvious at once
1. The great price peaks that occur as a result of war .
2. Even in annual terms there is no such thing as price stability or normal
prices.
A glance at the chart and consideration of the continuous change in the
price level should suggest the impossibility of price stabilization by the Gov-
ernment . Complete regulation of all things economic within the country and
complete insulation from all influences from without would be essential .
Manifestly this is impossible . The payment of subsidy, as in agriculture, is to
admit the impossibility of price control and to continue subsidy is to encourage
excess production and high governmental expenditure with its evil results.
x Data for 1800-1933 from Gold and Prices by Warren and Pearson . Data for 1934 to
date derived from Statistics by U . S . Department of Labor .
Without war the great price peaks with their resultant periods of chaos would
not occur . With war, they may be temporarily distorted or deferred but the
effects of abnormal war conditions cannot be permanently averted . One of the
unavoidable features of war is that the cost must be paid in full in one way or
another . There is no relief from this .
The great price recessions following the War of 1812, the Civil War, and World
War I are typical of those which have occurred throughout history in other
countries after major wars . It has now been over 8 years since hostilities
ceased in World War II . Within 8 years following the close of hostilities in
the prior wars mentioned, price declines from the peak values were as follows
TABLE 20 .Price declines 8 years after war
Percent
War of 1812 42
Civil War 33
World War I 33
World War II 3 .7
The depreciation of the dollar in terms of gold in 1934 would prevent an
ultimate decline of prices to the low levels following earlier wars . The closer
price control in effect during World War II retarded the price increase and the
advent of the Korean war has helped to sustain if not to increase the latest price
peak .
Present policy seems to be to prevent any such decline as we have sustained
after past wars . Painful and disturbing as they were, these past declines at
least resulted in paying much of the cost of the war in money of approximately
the same value as that which was borrowed for its prosecution, and that except
for the duration of the price peaks, those who depended upon fixed income for
their living expenses were not permanently deprived of much of their pur-
chasing power .
The new economic and debt policies seem to be designed in an effort to main-
tain productive activity and prices at or near the present plateau . The deluge
of complaints that flow forth when a small decline from the recent peak occurs
seems to indicate an unwillingness and lack of courage to face the responsibili-
ties for our actions . This tendency is not limited to any one class or group in
our citizenry . This softening of character is probably to be expected as a result
of the protective and paternalistic atitude and activities assumed by Govern-
ment in recent years . This may be due largely to an increased emphasis on
expediency rather than to a lessening of integrity, or it may be due to both . Be
that as it may, the continuation of the new philosophy will mean the retention
of high-debt levels, high governmental expenses, and a high cost of living . It
is important not only to balance the Federal budget but to balance it at a lower
level of cost. There is no margin of safety in the advent of a serious depression
or of a new war.
This is a most important point from the standpoint of public interest . In the
event of a depression, Government income will drop far more rapidly than the
volume of business declines . Government expenses will not decline but will
increase greatly if they "remain a significant sustaining factor in the economy"
as stated in the President's Economic Report . This means additional deficit
financing of large magnitude and therefore increasing public debt to unman-
ageable proportions .
The possibility of this coming to pass is indicated by the National Resources
Planning Board in a pamphlet of its issue under the title, "Full Employment
Security-Building America," The Board asks
1 . What policies should determine the proportion of required Government
outlay which should be met by taxation and by borrowing?
2 . What special methods of financing, such as non-interest-bearing notes, might
be used?
What are the non-interest-bearing notes to which reference is made? This
is merely a euphonious term for paper money, a product of the printing press .
But this paper money is also a debt of the nation . The various denominations
of paper money are non-interest-bearing demand notes, payable by the Govern-
ment to the holders on demand by them . The phraseology on the notes indicates
this and the Supreme Court has so held
In the case of Bank v . Supervisors (7 Wall ., 31), Chief Justice Chase says :
"But on the other hand it is equally clear that these notes are obligations of
the United States. Their name imports obligations . Every one of them expresses
upon its face an engagement of the Nation to pay the bearer a certain sum . The
dollar note is an engagement to pay a dollar, and the dollar intended is the
coined dollar of the United States, a certain quantity in weight and fineness of
gold or silver, authenticated as such by the stamp of the Government . No other
dollars had before been recognized by the legislation of the National Govern-
ment as lawful money."
And in 12 Wallace, 560, Justice Bradley says
"No one supposes that these Government certificates are never to be paid ;
that the day of specie payments is never to return . And it matters not in what
form they are issues Through whatever changes they pass, their ultimate
destiny is to be paid."
In commenting upon these decisions Senator John Sherman said in the Senate
of the United States
"Thus then, it is settled that this note is not a dollar but a debt due ."
Aside from the fact that paper money outstanding is strictly speaking a debt
of the Nation, the importance of the non-interest-bearing note question raised by
the National Resources Planning Board lies in the threat of greatly increased
supply of paper money. The effect of such action if taken will be a renewed
stimulation of drastic inflation with all its evil results .
Based upon the most reliable data available' our margin of national solvency
is rather small. According to these figures the total debt of all forms, public
and private, in the United States was 86 .5 percent of the total wealth, public
and private, in the country in 1944 . Since 1944, prices have risen due to inflation,
generally from 40 to 50 percent .
In terms of current prices, this raises the value of national wealth . For this
reason and because the total debt of the country, public and private, increased
only about one-third as much as prices, the ratio of debt to wealth as of 19481
had dropped to 63 percent . While later data are not available, the comparative
increases in prices and debt by the end of 1951 lead to the conclusion that this
ratio of debt to wealth may be somewhat higher at the present time . In 1929,
the debt-wealth ratio was 51 percent . In the interval from 1929 to 1948 the
ratio of Federal debt to national income (from which debt is paid) increased
from 4 to 32 percent . The influence of public debt on the integrity of money
values is far greater than the influence of private debt can possibly be .
If income goes down and debt goes up there will be a double adverse leverage
on the debt situation as measured by the ability to pay . If increased Federal
expenditures fail to work in stemming the depression, the situation will be loaded
with inflationary dynamite to the permanent detriment of all of us . The present
high level of prices is quite a springboard from which to take off .
Industrial production in the United States : Industrial activity is of over-
whelming importance in the economic life of the Nation . On chart 12 is shown
in graphic form a measure of this activity year by year since 1900 . The smooth
line marked "calculated normal trend" was computed from two long series of
data and is based on the period from 1898 through 1940 . The rising trend is
based on the increase in population from 1900 through 1953 and the annual rise
in productivity due to increased efficiency from 1898 to 1941 . With this trend as
a starting point, the data made available monthly by the Cleveland Trust Co .
were used to compute the total production as shown . The Cleveland Trust Co .
is in no way responsible for the index values of total production as shown on the
chart. The dotted line shows the corresponding index as published by the Federal
Reserve Board.
Except for the war years, the agreement between these two series is close .
The disagreement during the war period is possibly due to the inclusion by the
Federal Reserve Board of certain labor-hour data in computing physical output-
a method not followed by the Cleveland Trust Co .
The long-sustained upward progression in our productivity is a testimonial to
the industry and technical ability of our people . The increasing output in terms
of both efficiency and volume is the only source of our high and continued rise
in standard of living. It shows no abatement . The temporary interruptions we
call depressions are deviations from trends and are to be expected until we rec-
ognize their causes and if possible counteract them.
The significant part of the long-term trend at this time is from 1940 to date .
Since 1940, industrial output has been accelerated far beyond normal peacetime
requirements by the wasteful consumption and demand created by war . This
was followed by a resurgence of civilian demand composed of new and deferred
replacement needs . Before this was satisfied new military preparations were
resumed and the Korean war began .
s See vol . 14 of Studies in Income and Wealth by National Bureau of Economic Research,
1951.
Only with the stoppage of hostilities in that area has demand begun to slacken
although it is still fortified by continued production of munitions for war, some
of which we still supply to other countries . This sustained abnormal production
is evident on chart 12. Some of the more optimistic interpretations of these
characteristics are inclined to consider that we have embarked upon a new and
steeper trend to be traced from the beginning of recovery in the thirties to the
present time.
Obviously, the assumption that this is a normal trend discounts completely
the abnormally low starting point at the bottom of the depression and the
causes for the sustained bulge previously mentioned . It also assumes an increase
in productive efficiency that is not warranted by the facts . For years, the annual
increase due to improving productivity has been approximately 3 percent .
An increase to 3.5 percent would mean an overall improvement of 17 percent
in productivity accomplished almost overnight . During the wartime portion of
this period great numbers of unskilled employees were engaged in productive
work and many overtime hours were also utilized . Both of these factors reduce
output per employee hour . Furthermore, the increasing practice of sharing the
work and of limitations of output by labor unions have tended to offset what
would otherwise mean further gains in productivity .
The reason for the discussion of this point is the emphasis placed on the con-
clusion that the level of output since 1940 is abnormal unless we assume that
war and preparation for war are normal and that the great deferred demand
for housing, clothing, automobiles, and other articles was nonexistent.
For the Government to attempt to offset a return to normal peacetime levels
of output is to force a return to deficit financing on such a scale as to endanger
seriously the present value of the dollar . Then would follow further increases
in the cost of living and to the extent that it would occur, a further repudiation
of public debt .
Conclusions : The 20-year record of expanding Federal expenditures for hous-
ing, slum clearance, public works, nutrition, public health, social security, edu-
cation, and agricultural support clearly outlines the course of Federal procedure .
The great and increasing expenditures for the purposes just listed have been
made not in a period of declining output or depression, but simultaneously with
and in further stimulation of the greatest output in our history . This undue
and unwise stimulation, when output was already high, will make a return to
normal conditions additionally hard to bear or to prevent if Federal expenditure
is used for this purpose . The designation of "welfare state" seems to be well
earned under the developments of recent years . Perhaps the philosophy behind
it might be summarized in a remark made by Justice William O . Douglas in a
speech made in Los Angeles in February 1949 .
The sound direction of the countermovement to communism in the democ-
racies-is the creation of the human welfare state-the great political inven-
tion of the 20th century ."
Of course, this is not an invention of the 20th century . It was, for example,
practiced by ancient Greece and Rome to their great disadvantage .
It would seem to be countering communism by surrendering to it, wherein
the state assumes the ascendancy over the individual and the responsibility for
his personal welfare and security . It would seem more courageous and forth-
right for the Government to cease the cultivation of clamoring minorities, for
those minorities to stop demanding special favor in their behalf and for the
Nation as a whole to maintain its integrity by its willingness to pay the cost
of its deeds and misdeeds . Public interest many times requires the suppression
of self-interest and under our Constitution requires the maintenance of the
Nation intact for posterity.
Early in this study, there were listed the five channels of increased Federal
expenditure which the proponents of the welfare activities of Government sug-
gested . In tables 1 to 8 are listed the growing expenditures of the Government
under these classifications . The viewpoint that these activities are not in
accordance with our constitutional provisions is supported in principle by the
following opinions of the Supreme Court Justices quoted
"There can be no lawful tax which is not laid for a public purpose." (Justice
Miller, 20 Wallace 655 ; 1874) ; and again
"Tax-as used in the Constitution, signifies an exaction for the support of the
Government . The word has never been thought to connote expropriation of
money from one group for the benefit of another ." (Justice Roberts, United
States v . Butler (297 US ; 1936) .)
It is the departure from these long-standing principles that in a large measure
is the "revolution" which its proponents are announcing and endorsing .


Power travels with money . It is not feasible for the Federal Government
to assume the responsibility for collecting or printing money and for doling
it out to State and local governments and their citizens without imposing the
conditions upon which it will be spent . Thus by indirection Federal power will
grow and insidiously penetrate the areas reserved by the Constitution to the
States and their citizens .
Former Supreme Court Justice and Secretary of State James F . Byrnes, now
Governor of South Carolina has said
We are going down the road to statism . Where we will wind up no one can
tell, but if some of the new programs should be adopted, there is danger that
the individual-whether farmer, worker, manufacturer, lawyer or doctor-will
soon be an economic slave pulling an oar in the galley of the state .
The increasing confiscation of income through the power to tax, confirms the
thought expressed by Mr . Byrnes . We are on the road and it runs downhill.
The evidence is strong .
Abraham Lincoln once expressed his convictions on this relationship in the
following words
"The maintenance inviolate of the rights of the states, and especially the right
of each state to order and control its own domestic institutions, according to its
own judgment exclusively, is essential to the balance of powers on which the
perfection and endurance of our political fabric depend."
The conviction persists that the increasing welfare activities in which the
Federal Government has been engaged for 20 years can only come to some such
end as previously suggested if they are continued . It also seems certain that
heavy Federal expenditures to counteract a depression will prove ineffective .
Those important industries whose decline leads us into a depression are the ones
whose expansion should take us out of it .
An increase in road building will not put idle automobile mechanics back to
work, nor will a rash of public building construction or alleviation of mortgage
terms send unemployed textile workers back to their spindles and looms . Pro-
posed governmental measures will not be successful because they do not strike at
the causes of the trouble they seek to cure . After all, these same things were
tried in the long depression of the thirties without success . Pump priming did
not pay .
There is no thought or conclusion to be derived from this study that Govern-
ment has no responsibility in meeting the extraordinary conditions imposed by
crises due to financial or other causes. In the "arsenal of weapons" as men-
tioned in the Economic Report of the President are certain responsibilities and
procedures available for use as the need may develop . Undoubtedly, the most
important of these, implicit even if not specifically mentioned, is the maintenance
of the integrity and value of our money and of our credit system . The ventures
into "revolutionary" and socialistic fields of expenditure and especially in ex-
panding volume to stem a depression will be hazardous to and in conflict with
this major responsibility.
These two conceptions are completely antagonistic especially because our tax
and debt levels are so high as to leave little or no margin of financial safety . Our
recurring "crises" have been utilized in accelerating the progress of the "revolu-
tion" which we are undergoing . A further depreciation of our currency value
would provide opportunity for additional acceleration in the same direction .
In The New Philosophy of Public Debt, Mr . Harold G. Moulton, president
of the Brookings Institution, says
"The preservation of fiscal stability is indispensable to the maintenance of
monetary stability * * * . It is indispensable to the prevention of inflation with
its distorting effects on the price and* wage structure, and thus to the mainte-
nance of social and political stability ."
As someone has said, "What the government gives away, it takes away," and
this is true even if it comes from the printing presses .
Perhaps this study can be closed in no better manner than to quote from a
statement 4 by Mr. Dwight D . Eisenhower while president of Columbia University :
"I firmly believe that the army of persons who urge greater and greater cen-
tralization of authority and greater and greater dependence upon the Federal
Treasury are really more dangerous to our form of government than any external
threat that can possibly be arrayed against us."
4 Dwight D. Eisenhower, in letter to Ralph W. Gwinn, dated Columbia University, New
York, June 7, 1949, in opposition to a general Federal-aid-to-education program . (Con-
gressional Record, 81st Cong., 1st seas ., vol . 95, p . 14, p . A3690.)

INDEX OF CHARTS
Chart 1. Government civilian employees per 1,000 United States population .
Chart 2. Index of Government civilian employees .
Chart 3. Total civilian . employees of Government-Federal, State, and local .
Chart 4 . Federal receipts and expenditures per capita .
Chart 5. Population compared with Federal, State, and local tax receipts .
Chart 6. Federal, State, and local taxes-cents per dollar of national income .
Chart 7. United States Federal debt per family versus national income per
family.
Chart 8. Total debt per family versus private debt per family .
Chart 9 . Gross national product versus gross national debt .
Chart 10 . Gross national debt and disposable personal income.
Chart 11 . United States wholesale commodity prices in currency .
Chart 12. Industrial production in the United States .
DATA SHEET 1, CHART 1
Government civilian employees
Federal State and Total Gov-

em to ees local ernment
employees employees Federal State and
per 1000 Total
population per 1,000 per 1,000
population population
1901 }
1902 3 .3
------ --------------
1903
1904 3 .7 --------------
-------------- --------------
1905---- 4.2 --------------
1906 -------------- --------------
1907 4.1 -------------- --------------
1908 -------------- --------------
1909 4.1 -------------- --------------
1910 -------------- -------------- --------------
1911----- } 4.0 --------------
1912 -------------- -------------- -------------- --------------
1913 } 4.6 --------------
1914 -------------- ------------- °-- --------------
1915 4.6 -------------- -------------- --------------
1916 } -------------- --------------
1917 4.3 -------------- --------------
--------------
1918
1919 8.8 -------------- -------------- --------------
------------- --------------
1920 6 .5 -------------- -------------- --------------
1921 5 .5 -------------- -------------- -------------- -------------- -------------
1922 5.1 -------------- -------------
1923 4.9 --------------
--------------
-------------- ---- --------------
-------------- --------------
1924 4.9 -------------- ------------- -------------- -------------
1925 4.9 -------------- -------------- -------------- -------------- -------------
1926 4.8 -------------- -------------- -------------- -------------
1927 4.7 ------------- --------------
--------------
-------------- -------------- -------------

1928 4.8 -------------- -------------- -------------- --------------
`
1929 4.9 20.8 25 .7 100.0 --------------
100.0 -------------
100 .0
1930 5.0 21.3 26.3 102.0 102.4 102 .3
1931 5.0 21.8 26.8 102.0 104.8 104.2
1932 5.0 21.4 26.4 102.0 102.8 102.7
1933 5.0 20.6 25.6 102.0 99.1
1934 5.7 99.4
20.9 26.6 116.4 100.5 103.5
1935 6.4 21 .4 27.8 130.6 102.8 108.1
1936 7.0 23.3 30.0 142.9 112.0 116.6
1937 7.0 22.7 29.7 142.9 109.1 115.5
1938 6.9 23.5 30.4 141 .0 112.9 117.5
1939 7.4 23 .6 . 31 .0 151 .0 113 .4 120.6
1940 8.2 24 .3 32.5 167.5 116 .8 126 .5
1941 10.8 24 .9 35 .7 220.5 119 .6 138 .9
1942 16 .6 24 .3 40 .9 339 .0 116.8 159 .1
1943 23 .2 23.2 46 .4 473 .5 111.5 180.5
1944 24.2 22.6 46.8 494.0 108.6
1945 25.5 182 .0
22.4 46.8 520.0 107.6 182.0
1946 19.1 23.7 42.8 390.0 113.9
1947 15.0 166.5
25.0 40.0 306.2 120.1 155.6
1948 14.1 25.8 39.9 288.0 124 .0 155.2
1949 14.1 26.5 40.6 288.0 127.4 158.0
1950 13.8 27.1 40.9 281 .8 130 .2 159.1
1951 16.0 26 .7 42.7 326 .5 128 .3 165.2
1952 16.6 26 .9 43 .5 339 .0 129.3 169 .2
1953 16 .2 27.2 43.4 330.8 130.7 168.8
NOTE .-Indexes, 1929=100 . Not charted.

Source : Data on governmental employment from Statistical Abstract of the United States, 1953 . Federal
employment, table 404, p . 379, State and local employment, table 424, p . 393 .
DATA SHEET 2, CHART 2 AND CHART 3

Government civilian employees compared with other civilian employees
In millions
Government
employees Percent of
Total civilian lTotal civilian Labor force per 100 other 1929
labor, force Government other than
employees Government
employees
1929 49 .2 3 .7 46.1 6 .7 100 .0

1930 49 .8 3 .1 46.7 6 .7 100 .0
1931 50 .4 3 .3 47.1 6 .9 103 .0
1932 51 .0 3 .2 47.8 6 .3 94 .0
1933 51 .6 3 .2 48.4 6 .5 97 .0
1934 52 .2 3 .3 48.9 6 .7 100.0
1935 52 .9 3 .5 49.4 7 .0 104.5
1936 53 .4 3 .7 49.7 7.4 110.4
1937 54 .0 3 .7 50.3 7.5 111.9
1938 54 .6 3 .9 50.7 7.6 113.4
1939 55 .2 4 .0 51.2 7.8 116 .4
1940 55.6 4 .2 51.4 8.2 122 .4
1941 55.9 4 .6 51.3 9 .0 134.3
1942 56.4 5 .4 51.0 10.6 158.1
1943 55.5 6 .0 49 .5 12.2 182.0
1944 54.6 6 .0 48.6 12 .4 185 .0
1945 53.9 6 .0 47 .9 12 .5 186 .5
1946 57.5 5 .6 51 .9 10 .8 176 .0
1947 60.2 5 .5 54 .7 10 .0 149 .2
1948 61 .4 5.6 55 .8 10 .1 150 .7
1949 62.1 5 .8 56 .3 10 .4 155 .2
1950 63.1 6 .0 57 .1 10 .5 156 .6
1951 62.9 6.4 56 .5 11 .3 168 .6
1952 63.0 6.6 56 .4 11 .8 176 .0
1953 63.4 6.7 56 .7 11 .8 176.0
Source: Total civilian and Government civilian employees from Economic Report of the President, 1954 .
Total civilian labor force, table G16, p . 184 . Total Government civilian labor force, table G21, p . 189 .

i mnom
p~il' l~.'l i ~~ 3,
~
l tlGi!l _. .:~'.75fl5i"ni41i~M6!"d¢aa ~Ji! i M.
lifesEe:'!a91i : IM. i!! ow:z_ .I .F.90
~"M - •° ---
m .u. Imm ME 1 .' - - -- -- ------ - ~
9:'~° 331L g g g! :a . mail~y1 .1~F!
ire
,.za" 333a:sa ~:~3 :&
F5; p~9l33!~3 F5F9y3 : .:l :ae! _ _ '- - ~~ ME
ro:e3Mi. ~ia331 MI N
III
i
0 00 WE
e. '33!3's. ~s~!5 >Se ..31~E
1MEE
fly i55i .+, MIN
At mumms.
E!' ~fi:3ed eae>9SHi :iaf a ME M
INIMME 11411 MI lit ,
aRmi ~n « ME
mrom
_
a'7°
3 u3 u°. -'i
F. ::°a 5e~ ;~
F~ylallll 3i: IE
3g Hill •, •i lsee384
~ ~ MERE MERE
°.:. sa m N®
iI ~g.~ee il~ea~~i;~: ~aeat•3 ::~ ~' .
do
.11 ill •w
HIM . 1,111
11111 1111119H e~S3
. S~!!12i ?3o 9 ~~i :3 i n E
11~3331 ~3 ff~ui3,E_3 , : ~- MMEMB~3,!a a
iu° 6L !' MR g'`HE
u~ s3e,°i~«
.i ~
i
F 1111 11MMi~~i~sx s i3ri: !x ~w a ~ g~ _~
: .•a 'e3':E31'.tiia EM s.~ MR9~.l !m Y :.:a~~ M~l~sea"r ..ei" N
111, 111UMMimm , mm
•
; J~ 33 iip i g:«iu
i,i . _. .a.~ «3
. . MH ~ MEMO
x ~~~~~E~d g 9~:q
SOgNE r ~,
t E ii isIS: .€e~il9"e"Fal3lii6El311UME MEME
ME MEME
N34 . Y iii 1'/CIIF • 1 s~'!s : ME
111 02, 11111
MINE! ~iPlREs « ,_
W "I
_"Eiii
miumplic. IN ME .1
m
1
m.1 .313i e~ x No MEN€
3a
EMINIM . ME
ui~ai
02' = 3 !
's
u 111111111 MEE ~
_
m 1 M MM a1111
16S .isi5 e 9 :.11Mif 1801 : m E
g e 101110 Mi MERM~3°°::~3
IM 0
W , a > ei'1 aF3 - - Elm6"ail . . as~:
a2 . _
x'11" ~nne ~
,~•,5s
M~im • ARCO
gh li~5lgP3dlE~:"~F°: ME
T~ _1110111.
sss s :a
41
1 ~a : ~ 3'F3i s EN Y
M
MM
NIF
1111H MM MM
a u r. eras a u• p~ ~ ~,
1' 30 .3 34 0 • 6 98 5D 9


6'50 TAX-EXEMPT FOUNDATIONS

Ordinary receipts and expenditures
Federal Total Federal Total Federal Total Federal

Year Population Total
revenue expenditures revenue per expenditures
capita per capita
Millions Billions Billions

1900 . 76.0 $0 .567 $0.521 $7.46 $6 .87
1901 77.4 .588 .525 7.60 6 .79
1902 79.2 .562 .485 7.10 6 .12
1903 80.7 .562 .517 6.96 6 .45
1904 82.3 .541 .584 6 .57 7 .10
1905 84.0 .544 .567 6.48 6 .75
1906 • 85.5 .595 .570 6 .96 6 .66
1907 87.2 .666 .579 7.54 6 .64
1908 88.8 .602 .659 6.78 7 .42
1909 90.3 .604 .694 6 .70 7 .69
1910 92.0 .676 .694 7 .35 7 .54
1911 93.4 .702 .691 7 .52 7 .40
1912 95.0 .693 .690 7 .30 7 .27
1913 96.5 .724 .725 7 .50 7 .51
1914 98.1 .735 .735 7.49 7 .50
1915 90.6 .698 .761 7 .01 7 .64
1916 101.2 .78.3 .742 7 .74 7 .33
1917 102.8 1 .124 2 .086 11 .04 19 .89
1918 104.3 4 .180 13 .792 40 .00 132 .10
1919 100.8 4 .654 18 .9o2 46 .20 179 .20
1920 107.2 6 .704 6 .142 62 .50 57 .30
1921 108.8 5 .584 4 .469 51 .35 41 .00
1922 110.4 4 .103 3 .196 37 .20 28.95
1923 111 .9 3 .847 3 .245 34 .35 29.00
1924 113.5 3 .884 2 .946 34 .20 25.95
1925 115.0 3 .607 2 .464 31 .35 21 .40
1926 116.6 3 .908 3 .030 33 .50 25 .84
1927 118.2 4 .128 3 .002 34 .90 25 .39
1928 119.8 4.038 3 .071 33 .70 25 .33
1929 121.6 4 .036 3 .322 33 .20 27 .30
1930 123.1 4 .178 3 .440 33 .90 27 .95
1931 124.0 3 .176 3 .577 25.60 28 .81
1932 124.8 1 .924 4 .659 15 .40 37 .30
1933 125.6 2 .021 4,623 16 .10 36 .80
1934 126.4 3 .064 6 .694 24 .25 52 .90
1935 127.3 3 .730 6 .521 29 .30 51 .12
1936 128.1 4 .068 8 .493 31 .71 66 .30
1937 128.8 4 .979 7 .756 38 .63 60 .20
1938 129.8 5 .762 6 .938 44 .40 53 .40
1939 130.9 5 .103 8 .966 39 .00 68 .50
1940 131.8 5 .265 9 .183 40 .00 69 .60
1941 133 .2 7 .227 13 .387 54 .30 100 .40
1942 134.7 12 .696 34 .187 94 .30 253 .80
1943 136.5 22 .201 79 .622 162 .60 583 .50
1944 138 .1 43 .892 95 .315 317 .70 690 .00
1945 139.6 44 .762 98 .703 320 .50 706 .80
1946 141.2 40 .027 60 .703 283 .50 430 .00
1947 143 .4 40 .043 39 .289 279.00 274 .00
1948 146 .6 42 .211 33 .791 288 .00 231 .00
1949 149.1 38 .246 40 .057 256 .50 268 .20
1950151.1 37 .045 40 .167 245 .00 265 .00
1951 154.4 48 .143 44 .633 311 .80 289 .00
1952157 .0 ! 62 .129 66 .145 396 .00 421 .00
1958 159 .7 65 .218 74 .607 410 .00 466 .50
1930-35 Economic Almanac (1953-54) of the N . I . C . B ., p . 517 .

1936-52 Statistical Abstract of the United States, 1953, p . 337.
Expenditure data 1900-29 Statistical Abstract of the United States, 1930, p . 172.
1930-35 Economic Almanac (1953-54) of the N . I. C . B .
1935-52 Statistical Abstract of the United States, 1953, p . 340.
Source: Revenue data 1900-29 Statistical Abstract of the United States, 1929 p. 172.
1929=100
State and
Federal State and local tax
Year Population taxes local taxes Population Federal tax index
index index
Millions Millions Millions

1916--------------- 101 .2 $708 $1,935 83.2 21 .2 30.1
1917 102 .8 1,015 1,923 84.6 30 .8 29.9
1918 104 .3 3,352 2,309 85.8 100.5 35.9
1919 105 .8 4,482 2,923 87.0 134.5 45.5
1920 107 .2 5,689 3,476 88.2 170.6 54.0
108 .8 4,917 3,895 89.5 147.5 60.6
1921 4,015 90.8 106.6 62.4
1922 110 .4 3,554
111 .9 3,052 4,202 92.0 91 .4 65.4
1923 4,619 93.4 96.1 71.8
1924 113.5 3,207
1925 115.0 2,974 4,918 95 .0 89.1 76.5
1926 116.6 3,215 5,398 95 .9 96.4 83.9
1927 118.2 3,345 5,722 97 .2 100.3 89.0
1923 119.8 3,201 6,148 98 .5 96 .0 95.6
1929 121 .6 3,337 6,431 100 .0 100 .0 100 .0
1930 123.1 3,517 6,798 101 .2 105 .4 105 .7
1931 124.0 2,739 6,583 102 .2 82 .0 102 .4
1932 124.8 1,813 6,358 102 .7 54 .3 98 .8
1933 125.6 1,805 5,715 103 .4 54 .1 88 .9
1934 126.4 2,910 5,881 104.0 87 .2 91 .5
127.3 3,557 6.185 104.8 106 .6 96 .2
1935 105.4 115 .5 103 .5
1936 128.1 3,856 6,659
128.8 4,771 7,421 106.0 143 .1 115 .5
1937 106.9 163 .5 119 .6
1938 129.8 5,452 7,684
130.9 4,813 7,638 107.6 144.4 118.7
1939 108.5 147.6 124.4
1940 131.8 4,921 7,997
1941 133.2 6,889 8,315 109.5 206.7 129.3
1942 134.7 12,964 8,527 110.9 389.0 132.8
1943 --------------- 136.5 21,087 8,653 112.4 632.0 134.6
1944 138.1 40,339 8,875 113.6 1,210.0 138.0
1945 139.6 40,989 9,193 115.0 1,228.0 143.0
1946 141.2 36,285 10,094 116.3 1,088.0 157.0
1947 143.4 35,132 11,564 117.9 1, 054.0 179.7
1948 --------------- 146.6 37,636 13,342 120.7 1,129.0 207.5
1949 149.1 35,590 14,790 122.1 1, 066.0 230.0
1950 151.1 34,955 15,914 124.4 1,049.0 247.5
154.4 45,984 17,554 127.0 1,378.0 273.0
1951 --------------- 129.1 1,785.0 --------------
1962 157 .0 59,535 -------------
1953 159 .7 62,656 -------------- 131.3 1,878.0 --------------
Source: Tax revenue data from p . 516, Economic Almanac 1953-54, National Industrial Conference
Board . Excludes social security taxes except that portion used for administration of social security system
T
653•
TAX-EXEMPT- VOUNDATIONS

National income and tax receipts
Tax receipts, National Total, Total per- Tax receipts, National Total, Total per-
calendar years- income, billions cent of calendar years- income, billions cent of
billions income billions income
1929 $87.4 $10 .30 11 .8 1941 $103.8 $24 .36 23 .5

1930 75.0 9 .77 13 .0 1942 137.1 31.95 23.3
1931 58.9 8 .54 14 .5 1943 169.7 48.51 23.6
1932 41 .7 8 .00 17 .0 1944 183.8 50.59 27.5
1933 39.6 8 .54 21 .6 1945 182.7 52.52 28.7
1934 48.6 9 .68 19 .9 1946 180.3 50.37 27.9
1935 56.8 10 .59 18 .7 1947 198.7 56.39 28.4
1036 64.7 12.14 18 .8 1948 223.5 58.10 26.0
1937 73.6 14 .57 19 .8 1949 216.3 54.93 25.4
1938 67.4 14 .20 21 .1 1950 240.6 67.75 28.2
1939 72.5 14 .58 20 .1 1951 278.4 84.56 30 4
1940 81 .3 16 .95 20.9 1952 291 .6 __________ _________-
Source : National income, table G-7, Economic Report of the President, 1954 .
Tax receipts, Department of Commerce via Facts and Figures on Government Finance, 1952-53, by the
Tax Foundation . Table 90, p. 116.
TAY-EXEMPT FOUNDATIONS 655
Ao
rc
,lbi as a; 7q 44 eb s7 Sx ,y
National Number of National Federal' Difference,

income, families, income per debt per income over
bllions millions family family debt
1900 $16.2 15.96 $1,015 $84 $93.1

1910 28 .2 20 .26 1,392 57 1,335
1920 74 .2 24 .35 3,045 1,000 2,045
1929 87 .4 29 .40 2,972 576 1,396
1930 75 .0 29 .90 2,510 542 1,968
1931 58 .9 31.24 1,885 538 1,347
1932 41 .7 31 .67 1,317 615 702
1933 39.6 32.16 1,232 702 530'
1934 48.6 32.56 1,493 831 662'
1935 56.8 33.09 1,718 868 850
1936 64.7 33.55 1,928 1,006 922'
1937 73.6 34.00 2,164 1,072 1,052
1938 67.4 34.52 1,952 1 .076 876
1939 72.5 35.60 2,035 1,135 900
1940 81 .3 34.95 2,325 1,230 1,095
1941 103.8 35 .8 .5 2,895 1,365 1,530,
1942 137 .1 36 .45 3,760 1,990 1,770
1943 169.7 36 .88 4,600 3,710 800,
1944 183 .8 37 .10 4,950 5,420 -470
1945 182 .7 37 .50 4,870 6,900 -2,030
1946 . 180 .3 38.18 3,725 7,006 -3,281
1947 198.7 39.14 5,007 6,600 -1,593
1948 223.5 40.72 5,490 6,200 -710
1949 216.3 42.11 5,140 6,000 -860
1950 249.6 43.47 5,530 5,930 -400
1951 278.4 44.56 6,250 5,750 500,
1952 . 291 .6 45.46 0,415 5,700 715
1953 1306.0 47.50 6,440 5,600 840
I Estimated .
Source : Income data, 1900, 1910, 1920, estimated based on NBER data in "National Productivity Since
1869 ."
1929-52, the Economic Report of the President, 1954, table 0-7 .
Number of families based on United States census data .
a s
658 TAX-EXEMPT . - FGUNDATiON9,
Total
debt, pri- Private Number of Private Total National
vate and debt, families, debt ner debt per income per
public, billions millions family family family
billions
1929 $191 .1 $161 .5 29.40 $5,500 $6,500 $2,972

1930 191 .4 160 .8 29.90 5,380 6,400 2,510
1931 182.6 148 .6 31.21 4,760 5,850 1,885
1932 175 .7 137 .8 31.67 4,350 5,550 1,317
1933 169 .7 128.8 32.16 4,000 5,280 1,232
1931 172 .6 126.3 32.56 3,880 5,300 1,493
1935 175 .9 125.4 33.09 3,790 5,320 1,718
1936 181 .4 127.5 33.55 3,800 5,400 1,92&
1937 183 .3 127.9 34.00 3,760 5,390 2,164
1938 180 .8 121.3 31.52 3,600 5,240 1,952
1939 181 .5 125.5 35.60 3.530 5,180 2,035
19+0 190 .8 129.6 34.95 3,700 5,460 2,325
1911 212 .6 140.4 35.85 3,915 5,930 2,895
1912 260 . 7 143.2 36.45 3,930 7,150 3,760,
1913 314 .3 145.0 36.88 3,935 8,530 4,600
1914 371 .6 145.7 37.10 3,930 10.020 4,950
1915 407 .3 140.8 37.50 3,755 10,860 4,870
1916 398 .8 155.5 38.18 4,070 10,450 3,725
1917 419 .5 181 .8 39.14 4,650 10,720 5,007
1918 435 .3 202.6 40.72 4,975 10,690 5,490
1919 446.7 210.0 42.11 4,985 10,600 5,140
1950 485 .8 216.4 43.47 5,670 11,180 5,530
1951 519 .2 277.2 44.56 6,230 11,650 6,250
Source : Data on debt from Economic Almanac, National Industrial Conference Board, 1953-51, p . 122. .
Data on income derived from table G7, President's Economic Report, 1954, and Census Bureau data on .
families .

'CAX=EXEMPT FOUNDATIONS 659
4120
115
110
0So
loon
940
74
650
db
44
C 40
5
J
0
Q
3
1S
1926 30 J2 31 36 38 40. 4L 94 44 4e Sb 4 ;
Gross Gross
Gross national national
Federal product Gross Federal product
national debt, at 1929 national
product, product, debt, at 1929
billions consumer billions consumes
billions price, billions' price,
billions billions
1900 1 $16.9 $1 .26 ---------- 1927--. 89.6 $18.51 $58.6

19011 18.1 1 .22 ---------- 1928 91 .3 17 60 91 .2
1902 1 19.2 1 .18 ---------- 1929 103 .8 16.90 103.8
10031 20.5 1 .16 ---------- 1930 90.9 16 20 91.4
19041 21 .6 1 .14 ---------- 1931 75 .9 16 80 81.6
1905 1 23.0 1 .13 ---------- 1932 58 3 19 50 73 .2
19051 24.5 1 .14 ---------- 1936 55 .8 22 50 74 .0
19071 26.0 1 .15 ---------- 1934 64 9 27.70 8 :1 .0
19081 27.5 1 .18 ---------- 1935 72 .2 32 .80 90.2
1909 28.8 1 .15 ---------- 1936 82 5 38 50 102.0
19101 31 .1 1 .15 ---------- 1937 90 2 41 .10 107.8
19111 33.4 1 .15 ---------- 1938 84 .7 42 00 102.9
19121 35.7 1 .19 ---------- 1939 91 .3 45 .90 112.5
19131 38.0 1 .19 $65 .7 1940 101 .4 48.50 124 .0
1914 40.1 1 .19 68 .4 1941 126 4 55 30 147 .3
19151 47.0 1 .19 79 .4 1942 161 .6 77 .00 169.8
19161 53.9 1 .23 84 .7 1943 194 .3 140 80 192 5
19171 60.6 2 .98 81 .0 1944 213 .7 202 60 208 1
19181 67.5 12 .24 76 .9 1945 215 .2 259 .10 205 .0
1919 74.2 25 .48 73 .4 1946 211 .1 269 .90 185 5
1920 85.6 24 .30 73 .1 1947 233 .3 258 40 179 .0
1921 67.7 24 .00 65 .0 1948 259 0 252 40 184 6
1922 68 .4 23 .00 70 .0 1949 258 .2 252 .80 186 0
1923 80.4 22 .35 80 .7 1950 286 8 257 .40 205 .2
1924 80 .9 21 .25 81 .2 1951 329 8 255 30 217 .0
1925 95 .0 20 .52 83 .1 1952 348 0 259 .20 223 5
1926 91 .1 19 .64 88 .3 1953 2 . . 366 .0 266 .10 234 .0
I Estimated from data shown for 1899, 1904, 1909, 1914, and 1919 as indicated below .
2 Estimate based in data for 9 months and subsequent production data .
Source : Gross national product 1900-28, national product since 1869-NBER, pp, 119, 151 . Federal debt .
1900-28, Statistical Abstract of United States, 1930, p . 214 . Federal debt, 1920-52, Economic Indicators
Supplement 1953. Personal Disposable Income, 1929-50, National Income, 1951 editi ..n, table 3, p . 151 .

° ....
•: ••i3•i •:
.; .;. . ... ..
: °rill • •sn •n. :Y~
;; •:::::Y:a.3!! ::: 513,11
°, °
.g13Y. .. .; g: . ; :: , ::::
!1i: if IN, 'F3ii 1 1 - 11111,s~aii:in:::!3Sl :F 13317 ... ; .:-°..;.~E;
....:,! in =3
. °
F :::::: •n
:::::a:.:.::EF!F
euauu ie•n
i 3 3 m all liliFi% ii • - 1g g~ = i1 I illiil3el5e1i!iililaF
i..E 1111
!i11 '!i1 31111' ~~_ ll_.''' sii?1 li3 11133. 1'~1i !
s ~
FF
HIRE,
17711ilalFag I
it
i
SSg;agg Fl! ;°!l !i
3sssusl~a~umululaill.. pp
;. ;
1u!M~
isaE1 :ui111~
an s s
012
. 1 a...usil!.11~i11FlR 7:1:9::
r•:i ,~;~;1111111: ;1111: g r=
li1117i~a 9111111119 W 9" M E1r 999e
1NA;99
i_ isils s°u :9 u.e n"ia e!!ia
E 2;1 >us"s~9suTaieso9i1.e''
r rm g
130 0 .
° 13 's' HIM 11aiR9
57
!1F1':31a 9: :
g fm1
1S77i1119a
i . ;--
r 11111111
' c.
rims 16 7i.~1~ ''~1' 1-i'i{1
S11i1 N Da.
1 ~:= ~
SIR 31'191191
a
•, ga°g; °'i~31g
' i' NINE! 111
In Mill -liffiRMI! ON
59991; ; 'k .j II1iL9 1: ::;:::E 1113111ii1
in 111 1i 11111 1!111111
lil t ~:•
i n ll~uill
3° a
111 g NEW ° al I1111i: 991991°~9:79111~79 0
HER
I
91111111317 ~a11 !HI HI
wliii 3! 11%1 °
113 ig1= 1! 1 ~. ..i 1119E 9 711 111
1111 .i a11~° 7:: 1111 ei91> 1 : i • i t rill Sir 11 111:!11nF,!

sit iB4;°Bil si
Hill
I a 'iii 9N ~ ~ is~ls ll 1~1nee i 1111
S li~ i : .;
Eo !i
=Pill i i p.1 11111' °' !!l n ~~19
g~; 1iis f 1 1.1~ : ..f ess g~ 111:~S1pillii
13M1 1:'1 p' • 9511
10111,111 T • •s
1uo~~' 31.. 1 'Luu 1113N-H1,101BROW N'll
!!-4l 111
4
SS:a•s~9 ';3 9 9• B•ui 9'g9.2ii':•':•~ • 1S
S:a~1il9
::9z:r•
'- ~. u •. Is 0-111
••1
ENE
°ill: 11 3 9
•:
yl1111 1 :•3
el~se~'gR s.:u3 :: .
I. .~;!110su.11
9aiar G :9::1 Ohl!
. • 7
1
119i!n~Ei iE ' i iii ° ae E~ii~ !i9
'NINE g : rmeeuss :a:es1 H11111i11113111111
Hill i!1!:E!ll
el r;eieF0 # 11 ~f 711 i rip lYi3~~11~g e1i 1i
an •u nn +~ ;e , FFF ~4g~ a :uas5 :gg
111 . ;n-3H1111: lL7l3auF3~ 33331 iiliii~1111iiiN161R 0
9g~ grs191gggg1
°
all glgN 1~~Jl :B11~17ie1E'uussus i!! e•.r. i3 3ie
's
° . FFs,, . .,ins n• u e u. i
.~3l nnn:
:lieeillie ' .:m:;g .
:n1 11111 Mile.
elmwi9 - ' X114 .1111 s'" :: as•9 seiFE!399
~ ~ ,
9I113111! 111il119:7iaiBli~ X11 oia 911 P
1i31 r E ~: 1a9 9i1611s37eiiilr~in •Y

111 4 1
1111131~;~,EEi~~~;~9~;
; ~ .7; 1111 1111111 1 1 911 ~
is
11111119917333 3 i i 1711bi1111 0
111HEREo ~, 11 111
AR!! 1 ..3i 11f'11a1..
1sae3311:~®31a~ a
0
11MOOREE1 73 W, Mills =1 17
MOORE 111 0
mo19mum : slIi 111 ~eI
i Jor T
M Is
:;1111 -. . g1!E!!
o
, IIN
?,1 ° ~99 i~S ~111G i~~•3!3a
°:g g ir; 1i ::,
.1 ; 1 !11946 p .. . ?. 181199i9335c3 WE~'i
n n H
'a Ia flOQ W SNOI'l~lH
Percent Dispos- Percent Dispos-

Federal able per- Percent Federal able per- Percent
debt senal D. I. P . debt son 1 D. 1. P.
G. N . P, income, G. N. P. GNP income, G. N. P.
billions billions
1900 7 .46 --------- ---------- 1927 20 .7 ---------- ----------

1901 6 .74 ---------- ---------- 1928 19 .3 ----- --------
1902 A---- 6 .14 --------- -------- 1929 16 3 $82 .5 74 .9
1903 5 .66 ---------- .: 1930 17 .8 73 .7 81 .0
1904 5 .27 ---------- ---------- 1931 22 .1 63 .0 83 .0
1905 4 .92 --- 1932 33 .5 47.8 82.0
'1906 4 .66 --------- ---------- 1933 40 .3 45 .2 80 .8
1907 4 .42 ---------- --------- 1934 42 .7 51 .6 79.5
1908 4 .29 --------- --------- 1935 45 .5 58 0 80 .4
1909 4 .00 ---------- ---------- 1936 46 .7 66 .1 80 .2
1910 3 .70 --------- --------- 1937 45 .6 71 .1 78.8
1911 3 .46 ---------- ---------- 1938 49 .6 65 .5 77 .3
1912 3 .33 ---------- ---------- 1939 50 .3 70 .2 76 .8
1913 3 .13 ---------- ---------- 1940 47 .8 75 .7 74 .7
1914 2 .97 ---------- ---------- 1941 43 .8 92 .0 72 .8
1915 2 .53 --------- ---------- 1942 47 .6 116 .7 72 .2
1916 2 .28 ---------- ---------- 1943 72 .4 132 4 68.2
1917 4 .92 ---------- ---------- 1944 94 .9 147 .0 68 .8
1918 18 .1 ---------- ---------- 1945 120 .5 151 .1 70 2
1919 34 .3 ---------- ---------- 1946 127 .8 158 .9 75 2
1920 28 .4 ---------- ---------- 1947 110 .8 169 5 72 .7
1921 35.4 ---------- ---------- 1948 97 .5 188.4 72 .7
1922 33 .6 ---------- --------- 1949 97 .9 187 .2 72 .7
1923 27.8 ---------- ----------- 1950 89 .8 205 .8 76 .2
1924 26.3 ---------- ---------- 1951 77 .5 225 0 68 .5
1925 24 .2 ---------- ---------- 1952 74 .5 235 .0 67 .3
1926 21 .5 ---------- ---------- 1953 1 72 .7 1 250.0 1 68 .5
I Estimate based on data for 9 months and subsequent production data .

Souree : Gross national product, 1900-28, national product since 1869, NBFR, pp . 119,151 . Federal debt
1900-28. Statistical Abstract of United States, 1930, p . 214. Federal debt 1929-52, Economic Indicators Sup-
plement, 1953. Personal Disposable Income, 1929-50, National Income, 1951 edition, table 3, p . 151.

663
„ :9~7 7IFs.sS{FFFF.C
„s..
.
.'011
sIS..s; u ; ... .„. .
Fail {L:r• • ••• FR:S::S F'SSS FF ..
.{:• s• ;:•
sF c E~{EErfi FL{ E I i{{9 fi~EscF7: .eF : ::c :: fi„°s e9s;F!{? Fi{ fi sa ;7{
a {~rl:{{~:
ME{i JIM , •.,F i ~ i{{e{mi?Fi eU II
t2 :.Lat: : ... „ .. „.
.!!::
... :. { ~F s PS-9
- ..i
oc
~' F! F~'i~ Fe;~F~~FFF$FF{,~ QF~ss~i~ F Fi :s p s
L
F.~_".1~. .iii~FFat Fi.FFci-•: a:s:
Rules
,~
:. . . . es.
li Ile ~
sl lie'
: : . :.: . :
"
•.
s:ss::: •• ..
. . i
~;
FI~i
._
eeFeetd1 I s s ifil'sRr•elFik CiLF e :afi
: •c:r i ii.p_E € _. r
••• ••
ei{IBill
15
. ;.. ;. :9 7ff: 5111111111111:H i :cs cma99s . : ::{
i
fi'i
s.:Ell E
."si :"" sfriil: ecses!' rn .: 6f4F4lfiisB "i' 77777999!9 P
Fl:. {!lf~il ~gFF! FF Fae „I i{
;FF ; 9: " t99 e1 {9
r•
sass.: . 'sF :Fie ;F a:{.. , ..: :::::::7:: :::: :. 7T Is s :
rn
os . l s.eew I :71 : :LIII ! FlllssFaE.iii e1.e• ••• ••'
; !fl t rFs e: ..
:~: .• it : : .:fi: ::. s: HIM ,F91 ie{1: :1:
°:: s i Ei11La
M"
M ml 7 9 ese
sib i R
H All
:: •a F
Mil a :r{{{{
{°; 1 c. ...IIo;4a 799i:a:
111
i:ia8s :afII:I.EE :a . a : IF ,- s ea e :rc 3 :i HIMV a' i ~FF ae MIMI e€~
esa 9i : ila 94 .:r.i;
'a a• 7 . a Hill RUN i j uMIIJIl6 ~~'
si7F !if
F
~7 ! da ' EE a
i a Its fis71i7: a:9
:. i s. I,n.!
.! i~ iLIb Ih1ER iiE3li :iF rns F;U
: :9asFFF;F at{Fis " g o
!Li F77~ 9tt ••. F
::Feur :a, a eF g ii - I :g
u „c -::: :{.. °{{I9{{
{{4. .:.,'s{9{:i7si7 «.•I"sysffillII
DOORIN• I 7 9 .,0
:e :: :c
am I" 'i3?ss I ^ = s{{~c?LCa ~F7se a :F{
101.. 2: .Imb i
! sfi
9: 997 Iii ii : is "rl
Ei m .r :fiIi~
:
pi 1-e~ 1i~:"I~ Fn; FF
; •
-.:: :.1eE{ :F.::. fF~e~ FF~.F ." . {
fieF';;E ~ 7 I .;F : iE .
ON x 'y 11115: May ME., °a : :::
E F_,F,CsssFF { ME ,-"e_.__
III aFFiFFasJslF'.'.$F IMP °
i qcc fi: :::'~
:
IMLFi JIM
~{L JIM~ a s :! e::a rn.
saat:eWae "a4':: : eies,' ' iy
6=;~ Irny li ~ifia E :FT j:~ 'e6 Fe sF+
i IF'~ F FH F {IN MI
r ::: Ed. ! T
MIWE °Fe 9dF iF { ML °°islei{{{:~
"R i ~ fi:r
. :.. ern : e. E ME. !
i ,,,, :::u.~
{e 4 sF :a
u a ~~F1s:, ~
M;,
MON. Ffifififi:I ofifi! s: i !„ FF sF FE: FiI 79 O
- F F :: !
"' all -" Ili E ;
• eo6 _E :
:." 9'slf i pii :
FFF .. ;Fr « F mulml i
{{{ ::EFs{{{ ;:a;>::. ::: : . FPiFFgF~ FFIs( .:Fsre=e6 • :ca; r~;FFf
s :a 7tRC 9e 4s L 3. : •' i` iRE. ,is :as ~x f rE E
9_.9E.e .9. Ef:?e=
: e: l=lff 9
~ IN a srs e s eas9 " c
MIA MEMO
»s-a: ea ee r• e. s es^
iJIM ~FF116F3P09i ~; s Imp i i re
wil M.. III -
. ,MI ..,i7FF iiiiiHsB iISf4ir{

III fish!" OEM
q~F7~ :!IEI~ ;FFyp~si~i er r W ;y
NIN ~~
~N FO ® ~ ' :~FFaF~Cfi Eâ ~ r rII >
~Eliii-
„ : ? !:::::ac re" 55 ~iff~ F~:!
997: Ft;F I: :mls:": r :::6s 7saE:F 4 3e'• :1 'e4F:~"~rnemii ..
Via ;
,Fv + I s_ ~s„; c ei c 1
i ii Fili l mss! 'illIII le~ c iF eh~F:le
.{ ~! 71 i 1111011
~5'~ I ~
i;IY®li:fiiiFl:F .i~lim IS 7t C S 7°^' • p~f
a : F9c'9
FeF {7FFF!1°'lM
E E!E':
E.~car
F:17 e:a{44'::~~F~~ E E cF { ; e r~sr F s • •F s eF9 . 74iaa
gF~ i€€i` ~
pFF~l~i a$Ei:eflrn:: :: l.„..
I.e~i1 tee ,~tF~eFU~FFFtgu
~ X! HUMID iiiu 1014 I 10 1L. - ii-AN
ap-tr.i„,„efiFFBF :Fl4i Elm+
i ;1i :
i~
MMI ., °i" g
•M
~ i« ili l ilglE'sii lii x -
.~ !cg { ; F:F.- ER-s7: :"
~
^c, , y
;c°s79 F9 fi's ili iil{' :frNI iii II I - II • s ii is °: :e sai PROEM . :PRINT ice..::: a isii£F: : E:
is:"'"{-
~ „•7••-- s.es.
.:.:.. .„ ®~'- , iF~ a .7~[ r; ."aea7FF
SF711LiS 6a : Will FF „:aCa " ..::1-{FF7. 1fi 10110 F:. . :a~.:1l1 F:: : ;°F4l
:a °:~
a~E 9 7 III eE:l i fi e..
r „s f'I'vi
I iii Hill ~F:i - e
„ 3 a F {{e r ss_.êc
eio r7 IS, =A ~._ _ia~~ ii i i OO ... ii.: : :roamf{ ."!s e. ir°.PIMMEII
fi :°fifi ~_ EE _ AMA MA 74 F=LT
11_1 fi I
_~~gF~F sF~g , ;•. :F {{ 4, ca:arnrn11 ,~
9 °a
~ Biil14~ i H :Iciii~u . ..!_{R `
: 4rr a E :EEEEE94^ : 9"- •i° 3FFI~3l €; _ eF ~ %'F F: : :7F74
FsFa~ ~g~ :r 4 IE L; :ae.r „.... {1 ::: Irn
.,' HIS •c __H EF 4 :i7l:!
s. .fiE .1 1w isI .e rg 41 15s&SE :~,,HIEE-
+iR i:,
FFFy E, ; ! ~li S HE
Fiie-s5iaeufiEE
IN :f! 119
';Fz
•
' s" :
.
MIR ~ME EM' 6iv eci .
k :Fx{I: 2fl i &~E . Y: 1 ~cc u E' .:: .
MR ® JIM,: ii~ifii€ti, ;"F ~{ .. all9{=~
:__I. .IEI;~JUNIOR
;; l .e
°'!fi ~:tF .f4:.
e .. .:R ;M:E ae : x
ME 111 ~ " ~ii i i e.9{ y . :: ::
ME i ::": a mi :7sL„ ° ""LRI ! R . .. . 7,~".i-MM •
: .„ :.feF °'i
CFFFFFFFI:
ME 1.9 ~ : i1 In IMP :;. ::F~fi'F ;fi lfi ~ :::.m. -

~:i :1 , IMMUNE! .. .s ~ Mit~
!:! ! {! .
.. ..a "'
.:e:~~ !•ss: .F4 F • f9F: .R ' 191.4
v:e9:97
„ •• ••. "' 999x'97s °fi: :::
i =sip3ifi~i ~ie ~ E:~x; {sea ~lrn:ye :sep: rneFii9"fiF i :.. . ,. ...:
:r
MIMI . ~...„ .-. FFfl99 w -
s : s~asF s EE
s: EIEi::a °•
lFsFllo isiei dill,
aril :."we
: ::iii
°~
..: f P'
HERB 7 F
;. • e:. "
•s:c sc;: '
. •8
FF:E ::F I
MI
,.. • r ::
; F ii :i9Eiii,4 MIN "
: F
a: : Fy s l °ii l9f7f{: If{=FF : .:: :.;ii::
ill DUE I15_
°"
.: ;7
r +i s : 7 41EE'E9EM I99 s9999 s9 : --
e'::: ::{3 iE~
~ e{~: 7{!FI
Licl3'~{s
fili7~
s71.7•°.. ::+91
~=
=F
~~ ~
F .ai<~Fii3~~ea
F icii7 I7:iIn: ::af L
liiii .r.71:
7; 97i f :::ffai lE :;HIM{~:I
...iisaefF," ..
Nil , i Hii
... !F : a I El I fF • cEE ~7~~~p~FF~p~~ r:
._e. i. .e~ e~ep4~ d
ysiFefsi:Ffli9FfffiF a:iisc
Bs e07771i3sglMl iiifi9E JUI E{si
-s. . . ~: 9 f=Ffiffii: I ."rllel9f999 :i9999999::99 MI N
E:FF= ;~~{Els iii'a'!'c '7 ;. . ;..~ y s
aF ;S :• .
MINE 88~it:Fli .i~IN . . im 3~ p't":! fi E am ill OR : ~?.rlfll al9'?~{ il: :afl::
:a q {?{{®p~pFFFF~ e•• s sa : Fts„ EFs F?9FFii±ite~pegM ® ~i
. . acosG•dia~ iiF:i~ %lf,
•
Rip . ~as
EPA eiRe :r ce :os :
r. M go-
FLRC:C :F9e.?l::~'~=s::s:~„.ei:
o O O p -
K
665A TAX-EXEMPT FOUNDATIONS

Industrial production (physical volume)
Cleveland Normal Total New New

series Cleveland Normal Total
Trust trend,
Pro"'-
FR B Trust trend, Produc- Fseries
. R . B ..
index, 35 -39 index, tion,t
percent 1935-39=
100 1935-39= data,
1935-39 = percent 1935-39
100
= data,
1931009= 1935-39
of normal 100 of normal 100 =
100 100
low 103 32.7 33 .7 ---------- 1927 104 87.2 90 .7 94

1901 103 34 .2 35 .2 ---------- 1928 106 90.0 95 .4 98
1902 103 35 .7 36.8 ---------- 1929 110 92.8 102.0 109,
1903 101 37 .2 37.6 ---------- 1930 87 95.6 83.2 91
1904 96 38 .8 37.2 ---------- 1931 73 98 .3 71 .7 74
1905 108 40 .4 43.6 ---------- 1932 57 100 .5 57.3 57
1906 110 42 .1 46.3 ---------- 1933 68 102 .8 70.0 69,
1907 106 43 .8 46.5 ---------- 1934 68 105 .1 71 .5 74
1908 86 45.6 39.2 ---------- 1935 77 107 .6 82.9 87
1909 102 47.3 48.3 ---------- 1936 89 110 .0 97.9 104
1910 101 49.2 49.7 ---------- 1937 93 112 .5 104 .6 113
1911 94 51.0 47.9 ---------- 193S 71 115.4 82 .0 89
1912 104 52.9 55.0 ---------- 1939 88 117.9 103 .7 107
1913 105 54.8 57.6 ---------- 1910 102 120.6 123 .0 124
1914 95 56.8 54.0 ---------- 1941 127 123.8 157 .3 161
1915 100 58.8 58 .8 ---------- 1912 132 127.4 168 .2 196,
1916 114 61 .0 69.5 ---------- 1943 138 131.0 180 .7 235
1917 112 63.2 70.8 ---------- 1944 134 134.5 180 .2 231
1918 107 65.4 70.0 ---------- 1945 123 138.5 170 .4 198
1919---- 100 67.5 67.5 72 1946 114 141.8 161 .7 167
1920 102 69.4 70 .8 76 1947 126 146.0 184.6 185
1921___ ._ 76 72.2 54 .8 57 1918---- 131 151.9 199.0 193
1922 93 74 .4 69 .2 72 1949---- 115 155.6 179.6 180
1923 112 77 .0 86 .2 5 19 .50 133 161 .0 214.5 207
1924 100 79 .4 79 .4 82 1951 139 165.7 230.0 222
1925 107 82 .0 87 .8 91 1952 13') 172.5 225.0 23)
1926 108 84 .4 91 .2 94 19533---- 138 177.4 2245.4 ' 2 248
1 Derived from monthly data published by the Cleveland Trust Co . and independently calculated norms'
trend .
s Estimated .

TAX-EXEMPT FOUNDATIONS 665E
D
P'
r
P-
0
P-
m.
q
4
P
K'
P
d
K
w
N
K
K
n
K
a-
0O
0O
K cl
K
0
K
9

SPECIAL COMMITTEE
TO

H. RES. 217
STAFF REPORT NO . 4
SUMMARY OF ACTIVITIES
OF
THE CARNEGIE CORPORATION OF NEW YORK
THE CARNEGIE FOUNDATION FOR THE
ADVANCEMENT OF TEACHING
THE CARNEGIE ENDOWMENT FOR INTERNATIONAL
PEACE
THE ROCKEFELLER FOUNDATION
THE ROCKEFELLER GENERAL EDUCATION BOARD
Part I-June 9, 1954
Part II-July 9, 1954
Prepared by Kathryn Casey, Legal Analyst
UNITED STATES

SPECIAL COMMITTEE TO INVESTIGATE TAX-EXEMPT FOUNDATIONS

B. CARROLL REECE, Tennessee, Chotrman
ANGIER L . GOODWIN, Massachusetts GRACIE PFOST, Idaho
THOMAS McNXECE, Assistant Research Director
11
TAX.-gXEMPT FOUNDATIONS
STAFF REPORT NO . 4
INTRODUCTION
INTRODUCTION
One of the objectives of the staff, as mentioned in Mr . Dodd's report,

was to determine whether there was a common denominator, as it were,
in relation to foundation purposes . A collateral objective was to deter-
mine= if possible, whether the activities of foundations might fall into
certain definite classifications .
Upon examination of the material available in the Cox committee
files it was apparent that it was insufficient 1 to support a firm conclu-
sion on this point ; as were the various reference books available on
foundations and their activities . After further study and discussion
as to both the quickest and the most efficient method of securing suffi-
cient information, it was decided to examine the activities of the
first 2 major 3 foundations, to determine whether their activities could
be classified, on the theory that such an examination would also serve
the dual purpose of providing a guide for study of other foundations .
With size of endowment and date organized as criteria, the selection
of the agencies created by Andrew Carnegie and John D . Rockefeller
were quite obvious choices, as will be seen by a glance at the following
chronological list
Carnegie Institute (of Pittsburgh), 1896 .
Rockefeller Institute for Medical Research, 1901 .
Carnegie Institution of Washington, 1902 .
Rockefeller General Education Board, 1903 .
Carnegie Hero Fund Commission, 1904.
Carnegie Foundation for the Advancement of Teaching, 1905 .
Carnegie Endowment for International Peace, 1910 .
Carnegie Corporation of New York, 1911 .
The Rockefeller Foundation, 1918 .
The Laura Spelman Rockefeller Memorial, 1918.'
As a practical matter, the Carnegie Institute of Pittsburgh, the Car-
negie Institution of Washington and the Carnegie Hero Fund Com-
mission were eliminated as objects of study in relation to their fields
of activity, because their purposes were so clearly specified and their
activities confined thereto .
On the theory that the document itself is the best evidence, the
logical source of the best information was the records of the founda-
tions themselves, as contained in their annual reports and similar pub-
lication. When it proved difficult to obtain these reports from the
Library of Congress 5 recourse was had to the foundations themselves .
In the case of the two Rockefeller agencies-the foundation and the
General Education Board-the president, Mr . Dean Rusk, upon re-
quest responded immediately and loaned to the committee copies of the
annual reports of each of these organizations .
In the case of the Carnegie Endowment for International Peace
a request was made to permit studies of their records from the date
of organization, to which Dr . Johnson, the president, agreed without
hesitation, and every cooperation was extended in placing the records,
minutes of meetings, and confidential reports at the committee's
disposal . In the time available, it was not possible to cover in detail
all the material available for those years, but extensive notes were made
i2 Not only as to details, but also because it covered only the years 1936-51, inclusive .
In point of time .
4s In size of assets.
Its activities were merged with those of the Rockefeller Foundation, 1928 .
5 Since only 1 copy was available for circulation, the other being for reference .


and verbatim quotations extracted ; Mr. Perkins, of the Carnegie Cor-
poration had equally cooperated but, subsequently on special request,
the Library of Congress permitted the reference copies of the year-
books of the Corporation, the foundation and the endowment to be
withdrawn from the Library for use at the committee's offices.
In addition to these reports, the books and articles, including bio-
aphical material, available on both Mr . Rockefeller and Mr. Carnegie
gd their foundations, were consulted and studied.°
Based on these studies, and according to the records of the founda-
tions themselves, it was concluded that their activities had been car-
ried on in a handful of major areas, namely
I. Education .
II . International affairs, including international law.
III. Politics (in the sense that politics is the science of civil government .)
IV. Public affairs.
V. Propaganda .
VI. Economics ..
While some of these fields overlapped to a certain degree, that fact
does not affect the validity of the technique of analysis, nor the state-
ment of summation .
I. EDUCATION
GENERAL PURPOSE
Part I of this summary is devoted to answering three questions

1 . Have these foundations carried on activities in the field of edu-
cation?
(a) At elementary level?
(b) At secondary level?
(e) At college and university level?
2. What have these activities been (at each of the levels noted) ?
3. Did such activities have any evident or traceable effects in the
educational field?
Secondly, once the answers to these questions are determined, what
is their relationship (if any) to education, in the light of the consti-
tutional and historic attitudes with regard to it in tRlis country?
The activities relating to questions 1 and 2 will be summarized sep-
arately by foundation, for the entire period of its existence, in section i
1. However, since the activities of all these organizations are paral- I
lel-at least in part-the effects of all in the educational field, and
their relationship (if any) to the constitutional and historic viewpoint
will be summarized and compared in section 2 .
GENERAL INFORMATION
Of the Carnegie and Rockefeller organizations only one-the Gen-

eral Education Board of Rockefeller 1-from its outset has operated
exclusively in the field of education, in the sense of a relationship to
institutions of learning, teaching, and so forth . In the sense that all
e Bibliography : Life of Andrew Carnegie (2 vols .), V . J. Hendrick : Forty years of Carnegie
Giving, R. M . Lester ; 30 Year Catalogue of Grants, R . M. Lester ; Fruit of an Impulse,
Howard J. Savage ; Philanthropic Foundations and Higher Education, Ernest Victor
Hollis ; The Story of the Rockefeller Foundation, Raymond Fosdick ; History of the Stand-
ard Oil Co ., 'Tarbell ; American Foundations-Their Fields, 20th Century Fund ; Phi-
lanthrophy and Learning, Frederick P. Keppel ; Public Benefactions of Andrew Carnegie,
Carnegie Corp . ; The Foundation, Frederick P . Keppel .
1 Terminated operations at end of 1953 .
knowledge developed pertains to education, of course, then the term

"education" becomes practically all-inclusive of every activity not
only of foundations, but of industry and government as well . How-
ever, in the former sense-which is the sense in which it is used here-
Carnegle Corp. Carnegie Foundation for the Advancement of Teach-
ing, Carnegie Endowment for International Peace, and the Rocke-
feller Foundation are dedicated by their charters to purposes directly
or indirectly related to what might be called the advancement of edu-
cation.
In the case of the foundation, 2 originally intended as a means of
providing "retiring allowances" for professors, it is now its primary
purpose. The corporation 3 and the endowment 4 have it as one of a
multiplicity of purposes . Because this is particularly true of the en-
dowment, and because its activities are so closely interrelated that
agency's activities will be summarized as a unit when other categories
of foundation activities are covered .
One further fact should be noted because it is a matter which time
did not permit complete resolving . In the case of the corporation,
and the foundation, there is a considerable overlapping of funds, and
it is difficult at times to determine the extent to which the funds men-
tioned in the foundation's financial reports are duplicates of funds
mentioned in the corporation's report . To a certain extent this is
true also in regard to the endowment . Thus, while every effort will
be made in this report to differentiate clearly between the amounts of
money, it may be that sums reported in the foundation and the endow-
ment records are duplications of sums reported in the Carnegie record .
Inasmuch as the Rockefeller Foundation and the General Education
Board do not seem to have the interlocking relationships found in the
Carnegie organizations it is not believed that the same possibility of
duplication exists in regard to those two organizatons .
However, perhaps in an excess of caution, where doubt arose, the
item was not included so that whatever error has occurred has been
on the side of lower totals rather than higher.
BACKGROUND s MATERIAL FROM REFERENCE WORKS
Before proceeding to an analysis of information taken from the an-
nual reports of each of the foundations to be summarized, a brief
review of the activities in the field of education by these major con-
tributors may prove helpful and also serve as a basis for evaluation .
Dr. Ernest Victor Hollis in his book Philanthropic Foundations
and Higher Education, published in 1938, covers not only the back-
ground and organization of foundations, but also the specific activities
of foundations .in the field of education. While most of his references
are to higher education, portions of his work involve secondary educa-
tion indirectly, as will be seen later . Although published in 1938,
which makes many of the statistics of Dr. Hollis' book somewhat out-
dated, it is still regarded as an excellent reference .
s This term will be used throughout to designate the Carnegie Foundation for the
Advancement of Teaching .
e This term will be used throughout to designate the Carnegie Corp .
4 This term will be used throughout to designate the Carnegie Endowment for Interna .
tional Peace.
See bibliography, p . 669 .
According to Dr . Ernest Victor Hollis ° "unfavorable public esti-
mate of the elder John D. Rockefeller and Andrew Carne a made it
inexpedient in 1905 for their newly created philanthropis foundations
to attempt any direct reforms in higher education ." The subject was
approached indirectly through general and noncontroversial purposes,
nearly all foundation grants made before 1920 being for such pur-
poses.
Dr. Hollis writes
Far-reaching college reform was carefully embedded in many of these non-
controversial grants . It was so skillfully done that few of the grants are directly
chargeable to the ultimate reforms they sought to effect . For instance, there is
'little obvious connection between giving a pension to a college professor or giving
a sum to the general endowment of his college, and reforming the entrance re-
quirements, the financial practices, and the scholastic standards of his institu-
tion . This situation makes it necessary to present qualitative influence without
immediately showing the quantitative grant that made the influence possible .7
REMEDIES FOR EDUCATIONAL CHAOS
The first efforts of the foundations to influence the development of

higher education, according to Dr . Hollis, were directed toward a
differentiation and coordination of the levels of education, which he
stated "approached chaos" around 1902-5 .
It is not proposed to discuss whether the conditions existing in the
educational system at that time were chaotic or inefficient ; nor is it
intended to deny that the foundation and the General Education
Board were sincere in their belief that the system should be improved.
It is true, however, that neither of these organizations announced to
the public their intention to reform the educational system . On the
contrary, the board asserted on many occasions that it was determined
not to interfere with the institutions, nor direct their policies .$ The
president of the foundation, in writing of the early activities of the
foundation, admitted that originally even the founder, Andrew Car-
negie, was not aware of any intention other than the commendable one
of awarding a free pension, and in 1935 .Mr. Pritchett accepted the
fully responsibility for inculcating the reform idea in the pension
awards.
Moreover, it is not intended to evaluate the merits of the objective
and references are cited merely as indications of the intention and
attitude of the two foundations which first entered this educational
field. Additional references taken from the reports of the individual
foundations will be included in later sections of this part, dealing with
the individual foundation activity in education .
Dr . Hollis takes a very practical view of the manner in which
foundations approached the situation and the logical conclusion to be
drawn, when he writes
As a condition of awarding a pension to a college professor what could be
more plausible than the necessity for defining a college? Both the logic of the
situation and the desire for the money caused colleges to seek the scrutiny
of the foundation . By this indirection the foundation was being importuned
to do what President Pritchett most wished, and what he probably could not
@ Philanthropic Foundations and Higher Education .
' Ibid ., p . 127.
s See sections on Foundation and Board .
have accomplished by any amount of direct grants . With pensions as the induce-
ment the Carnegie plan for improving the colleges was explicit and avowed ;
the scholastic, financial, and control standards that were demanded for affili-
ation guaranteed that the institution would be a real college . Despite its pro-
testations to the contrary, the General Education Board sought to effect the
same reforms . I used grants to capital outlay and to general endowment as
the inducement and its leadership was canny enough not to print or use 'an
inflexible set of standards . The college seeking assistance was judged in terms
of its promise within the local area. The board "made a thorough study" of
the institutions calling themselves colleges and from this factual survey came
to a conclusion similar to that of the Carnegie Foundation as to what should
be done. Each foundation decided to organize and lead a superior system of
colleges and universities as a demonstration to the rest of the country . Their
purposes were almost identical, though their methods of work were radically
different, as were also their attitudes toward church-controlled colleges . The
actions of the Carnegie Foundation were the more open and therefore will enter
more fully into this narrative . But this circumstance should not obscure , the
fact that the General Education Board program sought similar goals and was
just as assiduously conducted!
Dr. Hollis goes on to say that, using this as a basis [eligibility for
a Carnegie pension], the specific requirements were established as to
what constituted a "college," and these requirements were later agreed
to in principle at' a conference, sponsored by the foundations of all
agencies interested in improving college entrance requirements .
Dr. Hollis, in comparing the policies of the foundation and the
General Education Board, refers to the former's standards as an "all
or none" dictum which "was happily absent in the more flexible, less
explicit plans of the General Education Board for improving
colleges ." to
Dr. Hollis referred to the setting up of means for improving col-
lege entrance requirements which grew out of the indictment of the
so-called mechanical credits which were congesting the colleges with
inadequately prepared students and again notes the contribution of
the foundation when he states
At every stage of this complex kaleidoscopic problem, the philanthropic
foundations interested in higher education have been aimed with the progres-
sive educators who are seeking such changes as those described as taking part
at the University of Chicago . * * * In addition to cash, the above organizations
and the Carnegie Foundation furnished the highly valuable services of pro-
fessional staff members .
Psychological examinations, comprehensive achievement tests, cumulative per-
manent record forms, and related admission devices had to be planned and
perfected before much actual progress could be made in improving the certifi-
cate plan of admission by units. The best professional and technical abilities of
the universities and nonteaching research agencies were given to the construc-
tion of these instruments . Columbia, Chicago, and Stanford Universities were
the centers in which most of this research was done, but other universities made
notable contributions . The American Council on Education provided the general
administrative and supervisory direction necessary to coordinate such a large
cooperative undertaking . The philanthropic foundations provided $1,212,450 of
the sum necessary for the work .
The six regional accrediting associations have jointly and severally been
granted $150,000 as a supplement to other resources, for studies looking toward
the formulation and application of qualitative standards for accrediting high
schools and colleges. The north Central Association of Colleges and Secondary
Schools has alone received foundation grants totaling $115,000 . This sum has
been devoted to developing standards for judging the effectiveness of the 2$5
institutions of higher education in the upper Mississippi Basin . It is expected
that the research will aid in a determination and statement of the aims, pur-
poses, and general philosophy of secondary and higher education . Aided by a
foundation grant of $25,000, the Committee of Twenty-one, representing the six
oto Ibid ., pp . 129-130 .
See sections on Carnegie Foundation and Rockfeller General Education Board .
TAX-tXEMPT 'OUNDATIONS 673
regional accrediting associations of the United States, is conducting a study of
accrediting that is focused on the secondary school . It has undertaken the
formulation ofstandards for accrediting high schools, and the outlining of pro-
cedures for their application and adaptation by the regional associations. Sev-
eral of the regional associations are individually undertaking minor studies
aimed at the solution of parts of the general problem . Educational and founda-
tion officials are united in the determination of supplement or supplant quanti-
tative accrediting with qualitative measures for admission to and progress
through high school and college ."
According to Dr . Hollis, the method of the General Education
Board was preferable in many respects, particularly in that it was
more tolerant than the foundation of which he states : "The limita-
tion of funds, and the conception of the trust itself, as well as the
philosophy of its first president, tended to maintain a rigid pattern of
action ." 12
He points out that the board, while it had a regard for high entrance
requirements, did not insist that colleges "conform to preconceived
general standards, regardless of actual local conditions ." 13
It recognized that the difference in educational, financial, and social
conditions in various parts of the country made it impossible, even-in
medical education, to achieve complete uniformity all at once, and that
to force the issue might merely result in changing the terms rather
than in fact raising standards . It was Dr . Hollis' opinion that the
failure to follow such a policy was "The basic cause for the early
bickering, strife, and only partial success of the foundation's college
admission efforts ."
Much dissension has arisen over the use of the so-called unit and in
later years the Carnegie Foundation was to vigorously attempt to
disassociate itself from it . In that connection it should be noted for
the record that the foundation and the board did not invent the unit
as a device for measuring progress through secondary schools but they
did contribute to securing its more effective enforcement . They there-
fore share with the schools the responsibility for introducing it into
secondary education although its retention past its usefulness may be
charged to the schools through their accrediting associations .
Both the foundation and the board were in agreement that the chief
offenders against standards were the various Protestant religious
denominations,Y4 and both agreed that there should be concentration
of effort in a few colleges which would have the effect of eliminating'
the weak colleges through lack of finances and other causes . However,
the methods selected by the foundation and the general education
board differed materially.
The bylaws of the foundation provided that no institution could
share in its pension fund if it remained under the control of a religious
group . The foundation also required that all affiliated institutions
have a 4-year curriculum and at least 6 full professors . (This auto-
matically established the size of the liberal arts colleges, namely, six
departments) ; 15 and required a minimum endowment or in the case
of State universities, an annual income .
n Ibid ., pp . 144-146 .
a Ibid ., pp . 133-134 .
'a Ibid ., p . 135 .
14 Ibid ., p. 138.
"After 1921 this was increased to 8 .
54610-54-2

674 TAX-EXEMPT FOUNDATION$
The board approaches the problem by "systematic and helpful cor-

roboration with the religious denominations, which took the form of
direct support of the stronger of such colleges . 16
Both the foundation and the board had concluded that by withhold-
ing funds from "the` weak and tottering or superfluous colleges," as
they were referred to, these institutions would die a natural death, con-
solidate or perhaps even coordinate with institutions selected by the
foundations as pivotal institutions . However, he adds, the results
have not borne out that conclusion-the Office of Education Directory
listing some 2,000 institutions of higher education in this country .
Moreover, according to Dr . Hollis, the waste, duplication and lack
of articulation are still evident, and according to Dr . Hollis were as
bad after the first World War as those facing the foundation at the
turn of the century .
***Accompanying this dissatisfaction with organization was an even
greater disapproval of the traditional content of the courses and their organiza-
tion into curricula. The manner of being admitted to and guided through these
offerings was reopened for further study. In short, after 1918 there was a new
start in efforts to resolve the confusion existing in American higher education,
and the philanthropic foundations influenced most of these undertakings .
After the war the philanthropic foundations entered into a more satisfying
relation with higher education . They were no longer forced to seek change by
indirection ; rather, they directly concentrated their grants and influence to
remedy some of the more glaring deficiencies that had been revealed by the war .
A more favorable public attitude toward philanthropic trusts made their new
approach possible. They now directly cooperated with the professional forces
of higher education in a new attack on the problems of organization to assure
institutional operation that would be more effective in modern life .
By 1920 about 90 percent of all college admissions were by the certification of 15
or more variously required units of the type of credit described by Learned .
Under this system inadequately prepared students were congesting the colleges .
At the same time the system hampered the effectiveness of the high school in
serving the much larger group of students who would not enter college . Those
college and foundation officials who subscribed to Learned's indictment of me-
chanical credits began to pool their money and talents to provide means for im-
proving college entrance devices, and this soon led to more fundamental studies
of the relations of secondary to higher education .
In addition to what may be termed "direct" activities, i . e., funds
granted to institutions themselves, or for projects in the teaching or
educational field all of the Carnegie and Rockefeller Foundations
made direct contributions of funds to the following organizations :
Adult Education "
American Council on Education
Cooperative Test Service
Educational Records Bureau
Institute of International Education
London School of Economics
National Education Association
Progressive Education Association .
Because of the effect of several universities on education, founda-
tions' grants to these institutions have been tabulated . The institu-
tions are
Columbia University
Columbia University Teachers College
University of Chicago
Lincoln School.
It Ibid ., pp. 138-140 .
17 Including grants to American Association for Adult Education.


THE CARNEGIE CORPORATION OF NEW YORK-THE
CARNEGIE FOUNDATION FOR THE ADVANCEMENT
OF TEACHING
CARNEGIE CORPORATION OF NEW YORE
ESTABLISHMENT, PURPOSES, ASSETS
The Carnegie Corporation of New York was the last of the philan-
thropic agencies created by Andrew Carnegie, and he served as its
president until his death 8 years later in 1919 . It was established "to
promote the advancement and diffusion of knowledge and under-
standing" among the people of the United States and the British
Dominions. Of its $135,336,869 endowment, $12 million is applicable
to enterprises in the British Dominions and Colonies, at the discre-
tion of the trustees. As of 1951 the assets of the corporation were
$175,890,810 .1
The corporation is managed by a board of 15 trustees, 4 of whom
are ex officio, 3 are presidents also of other Carnegie funds, and the
president of the corporation .
GENERAL POLICY
The corporation makes grants chiefly to universities, colleges, and

other organizations which the trustees believe can contribute to "the
advancement and diffusion of knowledge and understanding," and
devotes its entire annual income (except that necessary for adminis-
trative purposes) to such grants . Its officers do not attempt to keep
in active touch with programs, nor plan nor direct projects, full
res onsibility being assigned to the reciplent .
Question 1. From 1911 to 1952, inclusive, the last year for which
the annual report is available, the corporation made funds available
to
Appropriations
Universities, colleges, and schools in the United States 1 $56,838,274
For adult education 3,012,875
American Council on Education 1,012,875
Columbia University 2687,265
Cooperative Test Service, Educational Records Bureau, Graduate
Record, College Entrance Examination Board 90,924
Institute of International Education 2,366,326
National Citizens Commission for the Public Schools 750,000
National Education Association 261,500
Progressive Education Association e 76,485
Teachers College 3,727,650
University of Chicago 2,419,450
Total 73,243,624
1 Does not include Columbia University Teachers College or University of Chicago .
' Including grants to the American Association for Adult Education .
s Now called American Education Fellowship .
Funds were given to other organizations, such as the National Ad-
visory Council on Radio in Education, whose activities were less
directly related to education, but time did not permit exploring them
in detail . A brief description of the type of activity carried on by the
1 Basic Facts About -Carnegie Corporation of New York and-Carnegie Foundation for the
Advancement of TWaching, publighed by the corporation in August 1952 .
American Council on Education, the National Education Association,

and the Progressive Education Association is given in section 2 of
this summary.
Prior to 1930 the major grants of the corporation were for library
buildings, laboratories, endowment of liberal arts colleges, develop-
ment of such colleges through endowment, endowment of medical
schools at universities, and endowment, buildings, and support of
Carnegie Institute of Technology .
Question 2 . All quotations are from the annual reports, and in
order to avoid undue length, a few have been selected from many of a
similar nature. They appear in the annual reports under the head-
ing of "General Education," unless otherwise indicated .
1937 report
Page 20
The field of general education, even within the limits of scholarly inquiry is
too broad for any single foundation to cover, and, fortunately, more than one
foundation is now active therein. The present activities of the corporation,
working in close cooperation with the Carnegie Foundation, are the following
tests and measurements and records ; comparative education, notably in the
study of examinations ; professional education, particularly in its relation to
professional practice and to supply and demand in personnel ; the relation of
research to professional education, especially in the graduate school ; new de-
velopments of undergraduate instruction, supported chiefly by direct grants to
institutions ; and the maintenance of what may be called educational clearing-
houses, as in Australia and New Zealand. * *
Page 21 :
* * * Meanwhile, the problems of professional standards in general, the rela-
tions of the professions to one another and to other branches of education, the
needs of the public and the degree to which these are being met, have all been
comparatively neglected . The corporation has had opportunity to study these
questions rather closely in connection with training for librarianship, but its
interest includes all professions, large and small, as well as what may be called
emerging professions, that is, callings which are gradually assuming a profes-
sional status . It is the writer's belief that there is a definite need today to build
up a body of doctrine which will be based on reality and not on tradition . * * *
Pages 21, 22
This general situation opens opportunities to foundations for activities of the
greatest usefulness, but, unless the programs themselves are carefully organized
and rigidly limited in scope, there is a real danger lest they tend to draw the
foundation itself outside its proper sphere of action. It is essential not only
that the foundation be insured completeness of relevant data for its study, but
also that it be freed from any compulsion to press for action as a means of
justifying its conclusions . While it may advise frankly concerning changes,
when its advice is sought, it should never agitate for reforms or use its money
or influence as a means to a political end .
1938 report
Pages 31, 32, 33 : According to the report, on the basis of the general
purpose of each of the grants made in the period since 1933-34 for
educational studies, they might be divided as follows
To understand the student $50,300
To improve teaching 83,100
To show what is being done 129,350
To inform as to educational policy and organization 51,000
To find out what the students learn 191,500
Various other purposes 35,600
Total 540,850
TAX-EXEMPT FOUNDATION$ 677
The longest unbroken series of grants of this character made by the corpora-
tion has been voted to the Institute of Educational Research of Teachers College,
Columbia University, and it should be of interest to summarize the results of
cooperation with a small group of workers under distinguished leadership . In
the 16 years from July 1, 1922, the researches in psychology and education at
Teachers College under the direction of Dr . E . L. Thorndike have been supported
by grants from the Carnegie Corp., totaling approximately $325,000 . The find-
ings are reported in nine books or monographs already published (without cost
to the corporation), and nearly a hundred scientific articles, doctoral disserta-
tions, and special reports.
Nor must it be overlooked that, since science advances as a whole, the work
of gathering data which others may use, repeating experiments, adding here
and there to what others have proved, may in the long run be more valuable
than even such striking direct contributions .
1942 report
Pages 14, 15 : In the 1942 report the corporation lists as its three
major grants those made to the University Center in' Atlanta the
Johns Hopkins University in Baltimore, and the New York 'Uni-
versity in New York.
Referring to the Atlanta enterprise ($150,000), it is noted that far
greater grants had been given to it by the General Education Board .
Its purpose is stated to be
* * * a long-planned integration of the work of the several institutions of
college grade in that area under terms which will give Atlanta the advantage of
a modern university without requiring the constituent colleges to sacrifice their
identities .
The grant to New York University ($100,000) was made with the
understanding that the fund would be used for current purposes
rather than for endowment .
Pages 16, 17-The report then continues
Two grants totaling $65,000 were made to the Carnegie Foundation for the
Advancement of Teaching for continuation of cooperative work with a selected
list of graduate and undergraduate schools in developing criteria for admission
and in providing a basis for judgment as to ability of those already admitted
to candidacy for degrees . A more detailed statement on these studies will
appear in the 1942 report of the Carnegie Foundation for the Advancement of
Teaching . Additional grants totaling $21,000 were also made to the foundation
for two programs undertaken in cooperation with the American Council on
Education . Another grant of $10,000 was voted for the formulation of special
tests to be used in selecting the persons to be trained under the defense-training
program of the United States Office of Education .
As was recorded in last year's report, one of the largest grants voted in 1940-41
made possible the establishment of the Institute of Adult Education at Teachers
College, Columbia University . It is a pleasure to report that the institute
is rapidly defining a useful role for itself, and that the American Association
for Adult Education, now maintained entirely from membership fees, increased
its dues-paying constituency during a year when most voluntary professional
associations were suffering a decline in membership .
Among the adult education programs initiated with corporation support in

prewar days, none has proved more timely than that of the Council on Foreign
Relations . The regional committees organized in 12 strategic cities across the
country have met regularly for discussion of international problems and have
joined in producing an interesting summary of these discussions under the title
of Some Regional Views on Our Foreign Policy, 1941 . An appropriation of
$24,000 was voted for the continuation of this program .
In the United States it need no longer be argued that provision for the educa-
tion of adults is quite as properly a responsibility of the Government as is
education at other age levels . The war, indeed, has offered dramatic evidence
of the social cost of not affording such opportunities, and the numerous training
programs which have been improvised under pressure during the past 2 years

may be expected to continue, with suitable changes and improvements, into peace
times . * *
Question 3 . The excerpts from the annual reports given above, as
well as the quotations from Dr . Hollis' book, are pertinent to this ques-
tion also . No attempt will be made to include all the statements in the
year books of the corporation . Moreover, it is believed that 1 or 2
in addition to those already given will suffice .
According to Dr . Hollis' the foundations are exercising the initia-
tive accorded them to spend most of their money on exploratory work
that seems only remotely connected with improving college education
on the theory that research must first be done in general education in
order to efficiently accomplish college reorganization .
19M report
Page 14
One of the developments which has produced the most lively debate in educa-
tional circles has been the widespread movement to reinvigorate the ideals
embodied in the term "liberal education ." The goal is rather widely accepted,
but there is substantial difference of opinion as to how to achieve it . The general
educationists offer a variety of curricular reforms . Advocates of the Great
Books press their claims for the wisdom of the past. Humanists decry the shift
of interest from certain disciplines to certain other disciplines . Our colleges are
literally awash with formulae for salvation ; all of which is healthy and part of
the process of getting things done in a democratic, heterogeneous, and always
vigorously assertive society .
• * * President Conant and his coworkers at Harvard have provided leader-

ship in this direction with their efforts to develop a new approach to the teaching
of science as a general education course . During the current year the corpora-
tion made a grant to Harvard for the continuation of this work .
The social sciences also have a significant role to play . Serious men cannot
accept the view of those humanists who rhapsodize over Platonic generalizations
about society but resent the efforts of the modern social scientist to test these
generalizations . * * *
• * * Developments such as the new American studies program at Barnard
College (see p. 19) and the courses in Asiatic civilization at Columbia University
(see p . 21) would be impossible without vigorous participation, indeed, vigorous
leadership, on the part of the humanistic fields . But there is nothing in the
humanistic fields which offers a guaranty of salvation . They too have turned out
narrow technicians when they might have been turning out educated men . They
too have often ignored the central concerns of liberal education .
SUMMATION
Based on the foregoing, it can be assumed

Carnegie Corp . contributed large sums of money to projects which
can reasonably be considered "in the educational field' as shown by
their activities during the past 40 years .'
1911-20 : In millions
For library buildings, laboratories, or endowment in liberal arts
colleges J $3 .5
For development of liberal arts colleges chiefly through endownment__ 2 .8
1931-40 :
For research, study, publication ; grants-in-aid to individuals . 5
For development of women's colleges chiefly through endowment__-_ 1 .5
For development of fine arts and music in academic institutions 2,8
For adult education projects 4 .0
f Ibid., 150.
a Basic Facts About Carnegie Corporation of New York and ,Carnegie Foundation for the .
Advancement of Teaching, p . 11 .


1941-50
For area studies in universities 3.0
For research by faculty members ; grants-in-aid 2 .5
For education in American citizenship and history 2.0
For improvement of educational testing 1.2
For training in social science 3.0
For research in social sciences 2.0
For studies to improve education 4 .0
For graduate education in the South 1.2
For education in international affairs 4.0
Total 3& 0
This total does not include grants :
In millions
To Carnegie Institute of Technology $24.3
For development of schools of medicine 10.0
For support of dental research and education 1.3
For educational projects and for development of educational institutions
outside the United States 4.0
For development of college libraries and librarianships ; library schools
or library interests_' 8.6
For free pensions for college and university professors 21 .5
For others : such as Church Peace Union, Red Cross, etc 3.0
Total 72 .7
Grand total 110.7
As mentioned previously, the corporation has contributed $1,237,711
to the work of the National Education Association, the Progressive
Education Association, and the American Council on Education, and
their combined activities affect education at all levels .
In the early years of the activities of each of these organizations,
the amount contributed by the corporation was undoubtedly a siz-
able portion of the funds available to each of them.
CARNEOIE FOUNDATION FOR THE ADVANCEMENT OF TEACHING

ESTABLISHMENT, PURPOSES
The Carnegie Foundation for the Advancement of Teaching, created
by Andrew Carnegie in 1905, was the third of the philanthropic
agencies he endowed and like the others has its own funds, trustees,
administrative offices, and conducts its own affairs .
Fifteen years before when he was appointed a trustee of Cornell
University, Mr. Carnegie had been shocked to find that college teachers
were "paid only about as much as office clerks ." In the summer of
1904 while on his annual visit to Scotland, he renewed an association
with Henry S . Pritchett, a member of Theodore Roosevelt's Cabinet
and president of Massachusetts Institute of Technology ; and from
that meeting grew the establishment of a fund to provide pensions
for professors in American universities.
There have been two distinctily different phases of the foundation's
activities :
1. Activities designed-
to provide retiring pension without regard to race, sex, creed, or color, for the
teachers of universities, colleges, and technical schools-
within those institutions-
who, by reason of long and meritorious service, * * * shall be deemed by the
board of directors to be entitled to the assistance and aid of this corporation
or who by reason of old age or disability, may be prevented from continuing

in the active work of their profession ; to provide for the care and maintenance
of the widows and families of the said teachers ; to make benefactions to char-
itable and educational institutions, and generally to promote the cause of
science and education * * * 1
2. Activities designed-
(b) In general, to do and perform all things necessary to encourage, uphold,
and dignify the profession of the teacher and the cause of higher education
within the United States, the Dominion of Canada, and Newfoundland aforesaid,
and to promote the objects of the foundation, with full power, however, to the
trustees hereinafter appointed and their successors from time to time to modify
the conditions and regulations under which the work shall be carried on, so
as to secure the application of funds in the manner best adapted to the condi-
tions of the time .'
Until 1913 the foundation confined its activities to the first phase,
partly at least because the attitude of the founder was somewhat
different than that of its president, Henry Pritchett . The difference
is indicated in an exchange of correspondence between the two . Mr.
Pritchett apparently was imbued with the idea of coordinating col-
leges and universities into a more cohesive group .3 In December 1905,
he suggested as a name, "The Carnegie Foundation for Education,"
and wrote Mr . Carnegie
While the primary purpose * * * is the formulation of a pension system, our
charter enables us to undertake any sort of educational work for colleges and
universities * * * it may well happen in the future that our activities may
cover a far greater range with respect to education .
The name did not strike the founder favorably
The Carnegie Foundation for Education does not strike me favorably .
"Foundation" seems superfluous . "Carnegie Professional Pension Fund" or
"Carnegie Educational Pension Fund" seems to me better . It might be well,
I think, for you to ask suggestions for the name from the (directors) * * *~
I don't think that you should disguise the fact that it is first and foremost a
pension fund. The closer union it may bring about is incidental, though
important.
Dr. Pritchett, still president in 1916, indirectly confirms this : 4
The . development of a pension system along sound lines is the most direct duty
of the trustees, a responsibility all the more important because the pension prob-
lem, while a living problem in every State and Province of the United States and .
Canada, is still involved in confusion.
AS THE FOUNDATION VIEWED IT 20 YEARS LATER
The 1923 report includes the following paragraphs on page 20 :

The relation of the foundation to educational development and the studies
which it has carried on with respect to various current problems in education
have occupied a large part of the activities of the officers and of the staff of
the foundations . These studies, which have been published in 16 bulletins, have
concerned themselves not only with special problems such as those of medical
education, of legal education, and of engineering education, but also with the
underlying fundamental questions of education which relate to good teaching, .
to the content of the curriculum, and to the cost of public education . The estab-
lishment of the American Law Institute during the present year, by one of the
most distinguished groups of judges, lawyers, and law teachers ever brought
together, is directly related to the studies on legal education which the founda-
New York State Charter, granted May 8, 1905, surrendered when congressional charter
granted.
2 See . 2 (b) of congressional charter, granted March 10, 1900 . See . 2 (a) contains in
slightly different language original provision as to pensions .
s Fruit of an Impulse, p . 56.
4 11th Annual Rep&rt, 1916, p . 17 .

TAX; EXEMIT _ . FOUNDATIONS . 681
tion has carried out through its division of . educational inquiry. Experience
seems to indicate that an agency such as the foundation, standing apart from
the immediate institutional life and having,- no constituency, of its own, can do
its greatest service by enlisting in such studies the most able students in different
institutions, and that out of the contact brought about in such groups between
teachers,. administrators, and school systems, members of the staff of the founds-
tion, and others there is reached a degree of knowledge and of judgment with
regard to these problems which commands, a larger respect aud .attention than
can be had from the isolated statement of any one individual
Outside of the direct activities involved in the study and' establishment of'
pension systems and in the educational` ìnquiries and reports that have been
made, the officers of the foundation have necessarily been involved in a number
of educational relations of a temporary character having to do with. .the inaugu-
ration and operation of the educational organizations of the country, such as
the College Entrance Examination Board, the Association of American Colleges,
the Association of American Universities, the American Council On Education,
the American Association of University Professors, and the various other organ-
izations of those involved in the work of teaching or organization of education .
It has thus come about that during the 18 years of its history, the foundation,
while pursuing in the main two specific lines of activity-the one: having to do' with
pensions and pension systems, the other having to do with educational studies,
has nevertheless, by the very fact of these activities, been involved in greater
or less degree with all those complex relationss in . education which arise by reason
of the relationships between the schools of a nation, and the various bodies that
-have to do with education . The foundation has sought, during these years to
be hospitably minded toward any agency in education that cared for its co-
operation.
According to Dr. Savage," Dr . Pritchett's "pet idea" was realized
by Carnegie's grant to . the foundation for establishment of a division
of educational inquiry, and credits "Pritchett's patient persistence ."
Dr. Hollis quotes Dr . Pritchett as saying : 6
I put forward the suggestion, that while the primary purpose of Mr . Carnegie's
gift was the establishment of a pension system there would be involved in the
administration of this gift a scrutiny of education which would not only be de-
sirable in the granting of pensions, but would go far to resolve the confusion that
then existed in American higher education . There was no general requirement
of admission to college . Many institutions that were colleges in name, were
really high schools, and many universities were scarcely more than modest col-
leges . I suggestedthe notion that in the administration of this agency, some
criterion would have to be introduced as to what constituted a college .
ASSETS
The foundation received from its founder and the corporation
$32,700,000 .r Its affairs are managed by a board of 25 trustees and
according to the 'report for 1951 had assets of $12,874,718.84.
.In the 1939 report of the foundation appears the following
The cooperative arrangement between Carnegie Cooperative of New York . and
the Carnegie Foundation for the Advancement of Teaching respecting projects
in the field of higher education has now been in effect for about 15 years . Its
success has been unqualified . - A series of 148 grants totaling $1,449,393 have
been made by the corporation for 85 projects, of which 14, involving 34 grants,
have been carried on in the offices of the foundation, and 71 projects involving
$1,087,350 in 114 grants have been carried on under the auspices of 41 other
educational institutions or bodies . To these the foundation has allocated and
transmitted the funds provided by the corporation . On account of 3 projects
which could not be carried out as planned, $25,000 was returned to Carnegie
Corporation of New York through the foundation . The total of projects effective
over the past 15 years is therefore 82 .
6 Ibid ., p . 109 ; Annual Report for 1913, pp . 21-22.
e Annual Report for 1935, p . 129 .
'Basic Facts, p. 18.
54610-54-3
GENERAL POLICY
In the distribution of pensions, the foundation set up standards
which must be met by institutions in order to be eligible for pension
awards-designating those who met the requirements as "accepted"
and others as "not accepted ." 8
While as outlined earlier the foundation's activities began as a
pension award system for college and university professors, this was
shortly used as a springboard into secondary education with the ex-
planation that
1 . It was necessary to define a college in order to grant the ,pension.
2 . In order to define a college it was necessary to establish standards
of admission and of college work .
3 . If standards of admission were to be established it was necessary
to prescribe the courses of study in secondary schools which would fit
the student for the college-as defined .
The purposes of the foundation set out in its charter 9 clearly
place this agency among those whose sole or primary purpose is of
an educational nature, as evidenced by excerpts from its annual
reports .
From 1905 to 1951, inclusive, the last year for which complete
records are available, the foundation made appropriations to
Universities, colleges, and schools in the United States $62,763,560
American Council on Education 90.550
Cooperative Test Service, Educational Records Bureau, Graduate
Record, College Entrance Examination Board 2,850,000
National Education Association 10 115,000
Progressive Education Association 92,000
Total 66,011,110
The foundation, like the corporation, gave funds to the organiza-
tions mentioned previously whose activities were also of an educa-
tional nature .'2
Question 1 and question 2 . It would be difficult to draw a line of dis-
tinction between the quotations applicable to each of these questions,
and for that reason both questions will be covered together .
All quotations are from the foundation's annual reports unless
otherwise indicated, and are only a few of the many similar quotations
which might have been chosen, but which have been ommitted because
to include them would be merely repetitious .
Even after establishment of the division of educational inquiry, in
1913 13 the greater portion of foundation funds were appropriated for
pensions, or matters directly pertaining thereto, as shown by the fol-
lowing summary of grants from 1905-51 : 14
Retiring allowances and widow's pensions----- $59,298,459.42
Support of Teachers Insurance and Annuity Association_- -- 513,465 .37
Grants to colleges to initiate pension plans 775, 678.79
Pension studies 30,012. 87
Total 60,617,616.45
8 Later changed to "associated" and "nonassociated ."

e See pp. 26-27 .
10 Although the foundation appropriated funds to NEA (either its own or the corpora-
tion's) Mr. Pritchett himself was strongly opposed to the association's lobbying activities
for a National Department of Education (annual report for 1933) .
1 1 See footnote 3, p. 17 .
12 See p . 17 .
13 By grant of $1,250,000 from corporation. Total grants of the corporation were
$32 .7 millions .
34 Basic Facts, ibid ., p . 14 .
TAX-EXEMPT FOUNDATIONS 683'
Studies in education- (by the'division) 2,115,265.68,
Merger of testing agencies 750,000.00
Publications 45,632.18
Cooperative educational studies and research administered but
not directed by foundation 1,161,990.34
Southern colleges : To stimulate undergraduate teaching 873, 775.54
Total 4,203,963 .74`
However, this does not mean that the foundation's activities affected .
only pensions . Even as early as 1907 15 it was becoming more and
more a factor in determining not only what constituted a college, but
what type of organization. was best for conducting a college, including
such matters as the size of the board of trustees, whether or not the
president of the college should also be president of the board, and the
extent to which alumni should have a government of the institution .
The report, referring to fears expressed that "a great gift like this in
the hands of a limited number of men might prove a centralized power
which would hinder rather than aid the progress of education," dis-
counted such a possibility because the trustees were "in the main college
and university presidents who have come up through the profession of
teacher, and who are not likely to lose touch with needs and aspirations
of teachers ." is
1911 report
Page 46-The report deplored the fact that
* * * lack of supervision, both on the part of the General Government, and to
a large extent, on the part of the State governments, has resulted not only in an
extraordinarily large number of institutions bearing the name college or uni-
versity, but it has resulted also in the fact that these institutions have become
involved in local rivalries, so they represent in very small measure national
ideas on national purposes * * * .
The first "inquiry" of the new, division, which expanded rapidly, was
into the training of teachers and the standards of medical and other
professional schools . From the first, emphasis was put on coordina-
tion between colleges and universities, between these units and second-
ary education, and between both and elementary education . The
"individualism," "class feeling," and "competition" of educational
literature was deplored as-was the fact that universities were critical of
colleges, that State supported and privately endowed institutions
viewed each other with suspicion - and relations existing between col-
leges and secondary schools, and between liberal and vocational edu-
cation were referred to as "armed neutrality and open hostility."
Before long, there was to come the recommendation that since edu-
cational foundations were conspicuous illustrations of educational
cooperation, educational institutions could do no less. The school
system is referred to as
* * * an elaborate hierarchical device that undertakes through successive
gradations of textbook makers, superintendents, principals, and supervisors
to isolate and prepare each modicum of knowledge and skill so that it may safely
be entrusted to the humble teacher at the bottom, who is drilled for a few weeks
only, if at all, in directions for administering it ultimately to the child . Mean-
while, superintendents and school boards publicly measure their success by
numbers enrolled, by buildings and material equipment added, and by multplied
kinds of schooling introduced ; and the people are taught to accept this as educa-
15 2d annual report of the president and treasurer, 1907, pp . 54-55.
" Ibid ., p . 63 .
684 T,AX-EXEMPT FOUNDATIGN&
tion. Such perversions are ample comment on the . thoughtlessness of our for-
mula . Where is the school system that by enlightened and fearless propaganda
has convinced its public that education consists first of all in the superior quality
and skill of its individual teachers, and -is otherwise meaningless?
Qualitative education, as contrasted with the present dependence upon esti-
mates by bulk and housing, signifies a complete transformation in the character
and status of the teaching profession . Such a transformation once properly
accomplished, the other necessary modifications will inevitably take care of
themselves. America, with its hundred millions of people, needs upward of
three-quarters of a million men and women to represent her with the childhood
and youth of the Nation in a deliberate and thorough educative process . If wars
are to cease and democracy is permanently to hold the field, it will be a democracy
with sufficient wisdom to confide this, its most responsible task, to its most
competent citizens, and to prepare them thoroughly for its safe discharge . Gen-
uine education, in a sense consistent with any honest vision of its meaning, can
proceed only through immediate contact with keen minds fully informed and
persuaded of what the rising generation may become, and dedicated to such
achievement. Persons so equipped will in general not be had unless the dis
tinguished rewards and opportunities of life are attainable through teaching
careers . Moreover, these careers must not be mere avenues of promotion, as in
notable cases today, but must constitute and be recognized as opportunities for
achievement in themselves . Any other course means simply to exploit the future
in the interest of the present by abandoning its control to second-rate minds.
Plato's provision that the head of the state be the director of education expresses
the unavoidable perspective in a completed democracy .
Marked changes must ensue in our present system of schooling if we undertake
to carry out an honest interpretation of our avowed aim of "universal education"
by making it not only universal but also education . In the first place our ele-
mentary and secondary school systems must be thoroughly integrated into one
homogeneous and indivisible unit-a varied but coherent 12-year career for mind
and body, whereby, as a youth, each citizen may acquire a certificate of the
health, intelligence, and character that underlie a successful society * * *
Dr . Hollis 17 comments on the foundation's activities and policies
30 years later
The foundation had had a real battle to enforce entrance standards in the rela-
tively homogeneous endowed liberal arts colleges concentrated in the East. With
the decision to admit State universities to the benefits of the Carnegie pension
system it was faced with the problem of applying on a nationwide scale what was
in fact a regional accrediting standard for a group of superior institutions .
Educational, financial, and social conditions in this larger territory were so
uneven that many of the university officials in the South and Middle West urged
a flexibility in Carnegie standards in keeping with the realities the colleges faced .
After considerable study of the problem the foundation from considerations of
"logical consistency" (and possibly financial expediency), decided to leave the
rules a Procrustean bed for all affiliated institutions . The foundation was not
constructively interested in how a college might reach eligibility, but it did advise
the State universities not to raise their standards faster than the high school
could meet them, even if that meant delay in securing pensions . Apparently
the attitude was that growth could be stimulated by extending the hope of future
affiliation .
ELEMENTARY EDUCATION
Considerable attention was given to the place of both the elementary
and secondary schools in the educational picture . However, there is
indication that after 15 years of effort the foundation itself questioned
some of the results .
1923 report
Pages 78, 83 : Commenting that after the schools became free from
the hard-and-fixed curriculum and new studies intended to broaden
student opportunities were added, the report adds that the resulting
overexpansion was not entirely advantageous. As an example, it was
'* Philanthropic Foundations and Higher Education, p . ].33 .
pointed out that the organization and quantity of subjects had dis-
placed individual contact, relegating to an inferior position the fun-
damental truth that education does not consist in the amount of infor-
mation absorbed but rather in the ability to think clearly and to apply
the information accumulated to one's everyday life .
It would, therefore, seem to be fundamental that the elementary school should
accept clearly its own limitations . It should make sure that the teaching which
is common to all children is done with a sharp discipline of exact requirement,
but that a very large part of what is meant to be of cultural value shall be through
exercises not followed by examinations, but having as their spring of influence
the contact with cultivated and inspiring personalities .
Under this regime the elementary-school curriculum would be greatly
simplified.
In the second place, while we must in a democracy proceed upon the assumption
that every child is entitled to the fundamentals of an education in the elementary
school, we must frankly recognize that a large proportion of the children of
the Nation have neither the desire nor the intellectual ability to complete the
work of a secondary school with profit to themselves . In no nation in the
world is there a task comparable to that of the American teacher in the second-
ary schools, patiently and devotedly toiling to bring through to graduation
multitudes of pupils who have neither the desire nor the ability for intellectual
work. The high school should no longer be the refuge for mediocrity that we
have made it.
This involves no discrimination against any class or group in the body politic .
The stupid or indifferent child is just as likely to be the son of the well-to-do
as the son of the day laborer . Teachers are coerced by parents, by school direc-
tors, by all the influences that can be brought to bear, to keep in their classes
numbers of students whose happiness and usefulness are to be found elsewhere .
Again read without relation to other foundation activities, and
without linking with other organizations whose work it supported,
this, this too is a reasonable statement of a condition which might
need study in order to advance teaching . However, in view of the
results attributable to these other organizations in the installation
of "uniform standards and curriculum in the public schools," the
foundation's statements here and elsewhere in its reports cannot be
studied alone .
One of the present conditions, for example, which is undoubtedly
attributable to the philosophy reflected in this quotation is the 100-
percent promotion rule which exists in many communities, and to
which serious objections have been raised .
EUROPEAN INFLUENCE-PRUSSIAN, FRENCH, ENGLISH
At this point it should be noted that throughout the foundation's

reports the references are too numerous to mention-there are com-
parisons between education in this country and education in Europe,
always to the detriment of the United States 18
The foundation began its exchange of secondary school teachers
with Prussia in 1908 and the report for 1909 expressed the hope that
more secondary schools and those in charge of them would begin to
appreciate the benefits to be had from this exchange .19 This report,
and those for succeeding years, stressed the advantages of incorporat-
ing into the American secondary school, the same principles found
in Prussian schools with the object of raising the quality of teach-
is Annual reports for 1910 (pp. 35-39) ; 1911 (pp . 36-38) ; 1913 (pp. 57-59) ; 1924
(pp. 111, 116), and others .
18 Annual report for 1909, pp. 46-48.
in g and education in the United States to a level comparable to that

of Prussia.
SECONDARY LEVEL
In addition to cooperation and financial assistance to the National

Education Association and the Cooperative Test Service, the founda-
tion itself carried on work in this field . Again, there are numerous
examples which might be cited from the reports, but only one or two
will be included here.
1934 report
Page 107 et seq. : Pointing out that the secondary school is the
determining factor in the educational structure, the report goes on
to state that through its entrance requirements the college dominates
the educational program of the high school, yet at the same time
there is an unsatisfactory situation as far as the colleges and pro-
fessional schools are concerned, because of
* * * a growing army of high-school graduates who lack the qualities of
intellectual training which would fit them for fruitful college study . They
have indeed complied with the formal college requirements for admission, but
they have not learned to use their minds . A large number of the unfit are
eliminated in their freshman year, a process neither wholesome for the college
nor just to those thus summarily dismissed.
The report recommends as a remedy
The college can take the first great step by a sweeping change in its entrance
requirements . Instead of requiring a dozen subjects and accepting a passing
mark on all of them, it must test on a few fundamental subjects on which it will
demand a very high order of performance and accept the work of the secondary
school in all other subjects . To accept a passing mark of 60 percent has proved
demoralizing alike to high school and college, to teacher, and to pupil . In
fundamental subjects a high order of performance must be secured . This con-
dition complied with, the college can leave the secondary school free to educate
in its own way.
Here again it should be noted that no evaluation is made of this
objective, the particular means taken to achieve it ; nor is it pertinent
whether the results have been good or bad.
In 1928 the foundation began its study of the relations of secondary
and higher education in Pennsylvania . This study continued for
several years with funds supplied by or through 20 the foundation
($365,091 .36), and formed the basis not only for studies of a similar
nature both in this country and abroad, but in the publication of a
number of pamphlets ; and its recommendations have since been put
into effect 21
19f 9 report
Page 85
To meet the need for a suitable record a new form was devised and is now
published by the American Council on Education . On this record a student's
ratings in high school and college are presented graphically and comparatively
over a period of years so that his particular mental pattern appears at a glance
together with the tendencies of his intellectual development. Space is given
for standard test and achievement ratings of whatever nature, and provision
is ruade for appropriate personal data on the same comparative and chrono-
logical basis, thus presenting an integrated history of a student's educational
growth with the pertinent details .
70 From the corporation .
91 The most notable example is probably this suggested form which was recommended by
the Progressive Education Association for use in the schools .
COLLEGE AND UNIVERSITY LEVEL

There can be no doubt that the foundation carried on many activi-
ties at this level, not the least of which were those in connection with
its pension fund . One of the expressed hopes of the founder and
others was that by this method ., (removal of financial . worries) retire-
ment would be accelerated, and new blood brought into this part of
the educational process .
Another example is the experimental program of grants-in-aid to
instructional staffs in colleges and universities of the Southeastern
States which became operative during 1946-47. The organization
of this program was based on 4 strategically located centers, each
composed of 1 university group and at least 5 neighboring under-
graduate colleges. Each center received annually $15,000 from the
foundation, which it matched with $5,000 of its own funds .
1946-47
Page 24 : The purpose of the program as stated in the report, is to
advance graduate instruction-
* * * to vitalize it ; to improve its quality ; to help focus attention in college
and university alike on the need of improving the general quality of undergradu-
ate teaching. That Is the general aim . The choice of ways by which one might
seek to achieve this general aim is wide, but, as far as this experimental program
is concerned, there has been selected and agreed upon as eminently appropriate,
one single way . That particular way is the encouragement of faculty members
to carry on research and creative activities in fields in which they are interested
and competent. The underlying theory is simple : It is that a teacher actively
engaged on a scholarly research or creative project of his own choosing has more
than a fair chance of maintaining an intellectual activity which directly and in-
directly serves to raise his scholarly self-respect and to make him a more effec-
tive teacher . The primary interest of the program, then, is in the teacher and
his research, not in the instutition and its administrative and curricular prob-
lems and physical resources .
The foundation appropriated $700,000 for this program 2 for a
5-year period, 1946-51 .
Graduate testing program, cooperative test service, merger-national
testing service : A related activity of the foundation has been the
graduate testing program, carried out primarily with funds from the
corporation with small additions from the foundation itself.
1944-45 report
Page 13
* * * In 1929, when the foundation was in the midst of an examination
study of secondary and higher education in the State of Pennsylvania, the Gen-
eral Education Board made a grant of half a million dollars to establish an or-
ganization for experimental service in the construction and use of educational
examinations . This impressive gift, routed through the American Council on
Education, was intended for the use of Its committee on measurement and
guidance which had long been active in studying personnel problems under the
direction of the late Herbert E . Hawkes, then dean of Columbia College . There
was thus set up an agency known as the Cooperative Test Service which for
many years under the wise and vigorous leadership, of Dr . Ben D . Wood promoted
the construction and use of excellent educational examinations in many fields .
One of its notable achievements, developed shortly before the war, was the insti-
tution of a common qualifying examination for teachers which has been spon-
sored by the superintendents of a large number of the most important American
cities. This test and the graduate record examination possess many features in
common.
u Funds furnished by the corporation.
With the outbreak and early progress of the war the active functioning of this
agency fell into abeyance although its resources continued to accumulate . Its
recent revival under a reorganized committee of control was inevitable in view
of the indispensable part which objective measurement has played in the educa-
tional preparation of the Armed Forces and appears destined to retain in postwar
institutional activities .
With the revived Cooperative Test Service the graduate record office has be-
come closely affiliated in the broader matters of policy . Since February 1945,
Dr . Kenneth W . Vaughn, the associate director of the Graduate Record Office,
has also held the corresponding position with the Cooperative Test Service .
This mutual relationship has contributed much to effect a common understand-
ing between the two organizations and to coordinate their efforts in a common
cause.
1946-47 report
Page 33 : The following year there is further reference to this sub-
ject which culminated in the merger of the testing agencies in 194723
* * * In the main, this report directed attention to the compelling advantages
to American education of such a unification and to the principles on which a na-
tional nonprofit agency might be organized . The committee in the final para-
graph of its report indicated that its primary concern, in this phase of its work,
had been with the principles involved, and that no attention was given to the
practical problems of the several organizations whose cooperation was essen-
tial to the plan . It expressed the hope that its preliminary report would stimu-
late the fullest possible discussion of the practical means of arriving at the
objective.
In the spirit of this statement the committee recommended the establishment
of a new organization to be known as the Cooperative Educational Testing
Commission. It recomended further that the College Entrance Examination
Board, the Educational Records Bureau, the Cooperative Test Service, and Na-
tional Committee on Teachers Examinations of the American Council and the
Graduate Record Office of the Carnegie Foundation, join in the creation of this
commission, and that in addition to assets contributed by these constituent
agencies not less than $750,000 be provided by foundation grants .
While the report mentions serious objections raised by representa-
tions of the two largest agencies concerned, namely, the American
Council on Education and the College Board, it does not state what
the objections were, but added that there was no disagreement as to the
need for a central agency, or as to its purposes .
MERGER OF TESTING SERVICES, 1947 REPORT
Page 40 :
On December 19, 1947, the Board of Regents of the University of the State
of New York granted a charter to Educational Testing Service and thus enabled
it to begin operations January 1, 1948 . Besides the final grant of three-quarters
of a million dollars from Carnegie Corporation of New York, there were added
to the resources of the new Service approximately $450,000 from the College
Entrance Examination Board and the American Council on Education . The
initial capital assets of Educational Testing Service therefore reached about
$1,2410,000.
Three trustees ex officio served in perpetuity : the president of the
American Council on Education, the chairman of the College- En-
trance Examination Board, and the president of the Carnegie Founda-
tion . The board consists of from 9 to 25 trustees .
THE CARNEGIE UNIT
From the beginning the reports placed increasing emphasis on the

desirability of "coordinating" all schools throughout the United
28 1947-48 report, p. 40.

States, and the setting up of so-called units which became known as

Carnegie units.
Dr. Savage,24 tracing the influence of Dr . Pritchett in the expansion
of the foundation's activities into other than pension fields refers to
it as a "useful quantitative device" ; and the earliest known reference in
the public records of the foundation is in 1906 . Undoubtedly the
'foundation worked assiduously for its acceptance, and was successful .
When attacks began (as far back as 1909), 25 the foundation replied
that it was not standardizing, but merely working for uniformity in
entrance examinations, and later 29 that the use of the unit as originally
conceived and early promulgated did not tend to injure the educational
process, but it was the abuse at a later date by which "the individual
student was broken on the wheel of a mechanical device." The foun-
dation's attitude was : "What it has done is to make clear the standards
of the colleges themselves, and to throw the light of publicity on the
deviations from the standards they themselves have set up'
1947-48 report
Page 29 This report contains a detailed account of the origin, use,
and merits of the "unit" which Dr . Savage closes with the following
statement
Such in outline is the history of one aspect of American higher education in
which the Carnegie Foundation for the Advancement of Teaching had an im-
portant part . The foundation did not invent the term "unit," nor its definition .
In a time of educational confusion such as the country was not again to see until
1945 Dr . Pritchett, for the foundation, used it as one instrument in an endeavor
to bring order out of chaos.
The fact that the Carnegie Foundation appears to have been the first philan-
thropic enterprise professedly to award grants upon carefully considered ap-
praisal of the American college, and, in connection with that appraisal, to use
the unit, as invented and defined by others, is probably what led a considerable
part of the academic world loosely to prefix to the word "unit" the name "Car-
negie ." At any rate, the foundation has long considered the implications of the
phrase to be unmerited .
SUMMATION
From 1905 to June 30, 1953, 28 the foundation spent $62,763,560 in

retiring allowances and approximately $5 million on studies and re-
search in education .
Like its sister agency, the corporation, the foundation has con-
tributed to the work of the National Education Association the
Progressive Education Association, and the American Council on
Education, as well as to such programs as the Cooperative Test Serv-
ice, the Graduate Record Service, and the College Entrance Examina-
tion Board. While the amounts contributed to these organizations
were not as substantial as those of the corporation, nevertheless we can
assume that their activities and the results thereof were acceptable
to the foundation .29
24 Ibid ., p . 102 .
ze It was asserted that the "unit" was mechanical, tended to work against a true evalua-
tion of the individual, and that in pressing for it the foundation was attempting to impose
standards of its own making on American higher education .
m Annual report for 1947-48, p . 26 .
Or Annual report for 1909, p. 161 .
25 48th annual report, 1952-53, p . 44 . each of these organizations .
SB See see . 2 for a description of the activities of
54610-54-4

690 : TAX-EXEMPT FOUNDATIONS

THE ROCK EFELLER FOUNDATION-GENERAL
EDUCATION BOARD
INTRODUCTION
The first of four philanthropic agencies created by John D. Rocke-'
feller, Sr ., was the Rockefeller Institute for Medical Research in 1901 ;
the second was the General Education Board, limited to the promotion
of education within the United States and its Territories, established
in 1903 ; the Rockefeller Foundation, 1913 ; and the Laura Spelman
Rockefeller Memorial established in 1918 in memory of his wife . His
total gifts to each of these were : ,"'
The Rockefeller Institute for Medical Research $60,673,409 .45
General Education Board 129,209,167.10
The Rockefeller Foundation 182,851,480.90
The Laura Spelman Rockefeller Memorial 73, 985, 313.77
Total 446, 719r, 371 . 22
NoTE-In 1928 the Laura Spelman Rockefeller Memorial was consolidated with the
Rockefeller Foundation, with the exception of 1 or 2 specialized functions, which did not
fit into the foundation's program and which were transferred to a new organization called
the Spelman Fund of New York along with $10 million to carry on its work . This fund
has since been liquidated, as has the General Education Board (on Dec . 31, 1953, when
all its funds were entirely distributed) .
One other agency in this field-the International Education Board,
to which he gave $20,050,947 .50-was created by John D . Rockefeller,
Jr ., in 1923, because of the charter limitations of the General Educa-
tion Board . At this point it should be noted that the total of half a
billion dollars represented by the total of all Mr . Rockefeller's gifts,
is not the grand total of expenditures by his various agencies-it is
merely the principal to which must be added approximately the same
amount in income, which these agencies have also distributed, or yet
have to distribute .
REARRANGEMENT OF ACTIVITIES
The General Education Board carried on activities in the field of
education from 1902 to the end of 1953, but the Rockefeller Foundation
itself did not become active in the field of education for some years
after it was established, except to the extent that its work in the
medical, health, and agricultural fields may be considered educational.
The Laura Spelman Rockefeller Memorial operated only during the
decade 1918-28, and the International Education Board was in exist-
ence from 1923-38 .
192 8-29 report
Pages 3-6 : In the board's report that year, referring to the various
Rockefeller agencies, is stated that it was becoming evident that the
line between the activities of each was not clearly marked, resulting
in doubts on the part of the public as to the respective fields, and a
duplication of time and expense in the presentation of the same proj-
ects to two or more of the boards . A committee was appointed to study
the situation and to decide how the work might be carried on in closer
and more clearly defined cooperative relations . It recommended that
a new corporation, the Rockefeller Foundation, be created, into which
would be merged the former Rockefeller Foundation and the Laura
80 Story of the Rockefeller Foundation. Raymond B. Fosdick, p . ix.

Sp®lman Rockefeller Memorial. A ' further recommendation was

extension of the scope of the new foundation to embrace as a major
function-
the advancement of knowledge in-
(1) the medical sciences,
(2) the natural science (taking over the program in foreign countries of
the International Education Board),
(3) the social sciences (formerly carried on by the Laura Spelman Rocke
feller Memorial), and
(4) the humanities ;
and the appointment of a director and staff for each of these fields .
The final recommendation was division of the field of education in
the United States between the Rockefeller Foundation and the General
Education Board, along definitely determined lines . The net result
of this was to create two Rockefeller agencies : The Rockefeller Foun-
dation, a broad and general operation ; and the General Education
Board with activities limited to the promotion of education in the
United States .
According to this, "education" would fall into the orbit of the
board and "research" into that of the foundation . In the case of an
undertaking which embraces both objectives, the deciding factor was
the principal one, if the motive was education then it was a board
activity-if research a foundation activity .
The board from that time dealt chiefly with institutions rather than
with learned societies or researchh agencies . Also, it did not sponsor
individual research projects after that time except in educational
psychology and the educational processes that fell within its desig-
nated fields . Thus, the exclusive activities of the board after that
related chiefly to college education, public education and the processes
of education, the application of art to industry, and aid in accounting
methods and administration .
That year also the board withdraw from the field of medical educa-
tion because it felt that its part in the endeavor had been completed.
During the period 1913 to dune 20, 1929, the board had contributed a
total of $87,154,319 .33 to universities and colleges for whites, and
$18,191,328 .39 to colleges and schools for Negroes, exclusive of any
projects carried on in such institutions with board funds .
THE ROCBEFELLER GENERAL EDUCATION BOARD
Since the board 31 was the first of the Rockefeller philanthropic

trusts in the field of education, its activities will be summarized first .
As in the case of the Carnegie agencies no attempt will be made to
evaluate the merits of this agency or the Rockefeller Foundation
and this section of the summary like the other sections will be devoted
to ascertaining whether it is possible to fintl answers to the questions
raised in the opening statement . F'
However, it should be 'noted that whdn Mr . Rockefeller gave the
$1 million to the board in 1902, he referred to the -fact that the imme-
diate work of the board would be in studying the needs and aiding
to promote the educational interests of the people of the Southern
82 The General Education Board will be designated throughout this section as the board .
States, and during the early portion of its life, it was in these areas
that the board's activities were concentrated . It should also be noted
that the first permanent endowment, in 1905, amounting,to $10 million
was expressly designed to furnish an income-
to be distributed to, or used for the benefit of, such institutions of learning at
such times, in such amounts, for such purposes, and under such conditions or
employed in such ways as the board may deem best adapted to promote a com-
prehensive system of higher education in the United States ."
This limitation does not appear in the charter of the board 33 and it
was later removed by Mr . Rockefeller in subsequent letters of gift .
Management of the board's affairs was in the board of trustees, con-
sisting of not less than 9 nor more than 17 in number, elected for a
3-year terra. In following out its purpose it gave grants toward
the support of educational institutions, agencies, and projects, as well
as individual fellowships .
Although the board was created in 1902, the first published report
was in 1914 and it contains the following introductory note : 34
This volume gives an account of the activities of the General Education Board
from its foundation in 1902 up to June 30, 1914 . The board has made annual
reports to the United States Department of the Interior and these have been
regularly printed in the reports of the Department ; but no further report has
been hitherto issued, because, as the board's work was felt to be experiemental
in character, premature statements respecting the scope and outcome of its
efforts were to be avoided . After something more than a decade, tangible
results have begun to appear and to their description and consideration the
following pages are devoted . Henceforth, statements will be issued annually,
and from time to time, a more critical discussion like the present report will be
published.
In view of Mr . Rockefeller's deep interest in the South and southern
education, particularly elementary, the board at once set to work to
acquire a thorough knowledge of conditions in the Southern States
and surveys were made, State by State, culminating in a conference of
county superintendents in each State . These studies covered the
organization of the public-school system, its finances, the number and
character of school buildings, the number, training, and pay of public
schoolteachers, private and public secondary schools, institutions for
the higher education of women, schools for the training of teachers,
and schools, both public and private, for the education of Negroes .
1902-14 report
Page 13 : In a section entitled "Policy of the General Education
Board," the report states
But the studies just referred to did more than supply facts . For out of them
a conclusion of far-reaching importance soon emerged . They convinced the
board that no fund, however large, could, by direct gifts, contribute a system
of public schools ; that even if it were possible to develop a system of public
schools by private gifts, it would be a positive disservice . The best thing in
connection with public-school education is the doing of it . The public school
must represent community ideals, community initiative, and community support,
even to the point of sacrifice . The General Education Board could be helpful
only by respecting this fundamental truth . It therefore felt its way cautiously,
conscious of the difficulty, complexity, and delicacy of the situation .
As a statement of policy this language leaves nothing to be desired
and as referred to previously, in this respect the avowed intentions of
ae Letter of gift, June 30, 1905.
"Act of Congress, January 12, 1903.
P . XV, annual report, 1902-14 .
the Rockefeller agencies were at variance with the avowed intentions
of the Carnegie Foundation for the Advancement of Teaching .
Question 1 and question 2 . It is difficult, if not impossible, without
duplication to completely separate the quotations pertaining to these
two questions . For that reason and because they have equal validity
in providing answers to both questions, no attempt will be made to
distinguish between them .
Unless otherwise indicated, all quotations are from the annual
reports of the board, with the year and page as noted . Because the
activities of the board which relate to these questions are so varied
and also because they fall into certain more or less distinct topics
they have been subdivided .
ELEMENTARY AND SECONDARY EDUCATION
1902-14 report
Pages 80, 81, 83 : There is a certain amount of overlapping between
these two levels of education, and for that reason no dogmatic dis-
tinction has been made . Because it saw deficiencies in secondary edu-
cation in the South, the board approached the problem by selecting
a person or persons whose business it was to inform, cultivate, and
guide professional, public, and legislative opinions . Believing there
was need in every State for trained specialists in the field of secondary
education, it felt this individual should also "skillfully and tactfully
marshal all available forces for the purpose of securing concerted
action calculated in time to realize a secondary school system." Aware
of the lack of funds in the hands of the State departments of educa-
tion, or the State universities themselves, the General Education Board
then entered the picture and stated its willingness-
to make appropriations to the several State universities for the salaried and
traveling expenses of a professor of secondary education whose main and prin-
cipal work shall be to ascertain where the conditions are favorable for the estab-
lishment of public high schools not in existence ; to visit such places and to
endeavor to organize in such places public high schools in accordance with the
laws of the State ; to endeavor to create in such communities a public sentiment
that shall permanently sustain such high schools, and to place the high schools
under such local leadership as shall give them intelligent and wise direction, and
he and the university shall exercise a fostering care over such institutions .
While stating that the board did not attempt either to indicate or
to dictate the lines along which the individuals should exert them-
selves; it describes their activities in the following terms
In addition, the professors of secondary education were high-school evangelists
traveling well-nigh incessantly from county to county, returning from time to
time to the State university to do their teaching, or to the State capitol to confer
with the State superintendent . Wherever they went, they addressed the people,
the local school authorities, the county court, teachers, businessmen and business
organizations, county and State conferences, etc. They sought almost any sort
of opportunity in order to score a point . Law or no law, they urged their hearers
to make voluntary efforts toward a county high school, if a start had not yet been
made ; to add a grade or a teacher to a school already started ; to repair the build-
ing or to provide a new one ; to consolidate weak district schools into a larger
one adequate to town or county needs . Nor did they merely expose defects,
tender advice, and employ exhortations ; they not only urged the policy, but
nursed a situation. By correspondence they kept in touch with places already
visited ; from time to time they returned, to renew pressure or to recognize
achievement . *
:694 'TAX-EXEMPT FOUNDATIONS
During the 10-year period the board contributed $24,862 in 12

Southern States .
191616 report
Page 39 : The board held meetings those years on the question of
"needed reforms in elementary and secondary education," one out-
growth of which were the Occasional Papers 2 and 3. However, the
Board was again quick to state that it was interested only in facilita-
ting the trial of "promising educational experiments under proper
conditions."
1918-19 report
Page 41 : The board continued to make sums available to the State
universities for a professor of secondary education and also made
funds available for departments of secondary education . These pro-
fessors of secondary education were urged and encouraged to work on
the high-school curriculum and organization as well as the improve-
ment of teachers in actual service and the administration and effect of
State subsidies and Federal grants, and it was around this time that
the subject of "public education" was included as a section of the
annual report .
Throughout its history the board divided its activities, devoting a
section to white colleges and universities, and a section to Negro
education.
1923444 report
Page 29 : The board states it was becoming increasingly clear that
the professors of secondary education had substantially achieved the
purposes for which they were originally supported .
That same report, in referring to the improvement in the State
departments of education in the Southern States, announced that it
had decided that the need was for trained men and women in the field
and with that object in mind it had appropriated in 1922, $50,000 to
provide scholarships for persons occupying important posts and
increased the sum to $80,000 during the year just closed .
The colleges most frequently selected were
George Peabody College for Teachers
University of Chicago
Teachers College, Columbia University
Columbia University
Cornell University
University of Wisconsin
Harvard University
University of California
Hampton University
GENERAL EDUCATION INCLUDING TESTING AND ACCREDITING PROJECTS

The board began what it referred to as a general education program
in 1933 and it continued for about 5 or 6 years . It was during this
period that much of the work of the various testing and accrediting
agencies was being done, and for that reason much of the comment in
the reports is on that subject .
1933-,34 &,nnucd report
Page 4 : In this report there is the following statement
From 1929 to 1932 the board gave its support to several projects for the im-
provement of school and college relationships and for the intensive development
of quality in college education * * * . Through aid to institutions and to edu-
cational commissions, there were studies made of the accrediting, examining,
and teaching procedures in force at a number of representative institutions and
within large areas of the country . At a few places controlled experiments were
carried on by the college administrative officers and staff having the respon .
sibility of selecting students and of organizing courses of study for both schools
and colleges * * * .
1933-34 annual report
Page 5 : Referring to the critics of educational practice and their
request for new purposes rather than for further modification in
existing routine, the report states
It was pointed out that too little has been done to discover a form of education
universally useful to man in society today ; that by formal or informal methods
every individual should be made familiar with the forces that he will encounter
in daily living ; and that apart from special preparation for earning a livelihood,
he should be made ready for continuous participation in the responsibilities and
satisfactions of life to the extent of his individual ability .
The purposes of a general education for individual and social usefulness can
be stated, they believe, in a way that will have meaning for adults as well as
for younger students ; the adaptation of methods for its attainment will then
be practicable through the processes of formal and informal studies . From
such considerations the board reached the conclusion that assistance through
the further definition and development of general education through appropriate
agencies should be one of the purposes of its new program .
This is included at this time in view of the grants made later by
the board to other organizations and for types of projects .
BUILDING AMERICA
Page 8 : The report contains the following, under a subheading
"Reorganization of Subject Matter Fields-Society for Curriculum
Study `Building America"'
In the spring of 1935, a new monthly periodical was launched by the Society
for Curriculum Study with the assistance of funds provided by the General
Education Board. The magazine represents an attempt on the part of the
society to meet a long-felt need in secondary . education for visual as well as
factual study of contemporary problems of our social, political, and economic
life . A characteristic feature of the publication lies in its emphasis upon pictures
and graphs as a means of presenting facts and indicating problems . Housing,
Men and Machines, Transportation, Health, Power, Recreation, and Youth Faces
the world are among the issues already published . Throughout the various
types of curriculum, ranging from instruction in subject matter to the newer
types organized around basic functions or major interests of society, Building
America studies are now being used in valuable organizedd visual aids and as
useful units of study . A further appropriation of $30,000 over a 3-year period
was made this year by the board with a view to developing the magazine to a
point where it will be self-supporting.
Pages 11, 12, 13 :
The various educational accrediting associations of this country are in position
to play a significant role in the reorganization of secondary education . For
some time now, they have recognized that important modifications in standards
and procedures for accrediting are imperative and a cooperative attack on the
problem has been organized by a joint committee of 21 members representing
the several associations * * * .
$116,000 over a 2-year period has been made by the board to the
American Council on Education .
1936-37 report
Pages 60-67 : Grants were made that year in support of work by
organizations and institutions in the following types of activities
General planning of educational reorganization : Taking stock of the situation,
discussion, and agreement upon the purposes of general education, and planning
for such reorganization of general education as is necessary to make it attain
these purposes .
Experimentation with the curriculum and evaluation of the results of such
experimentations .
Preparation of new instructional materials and experimentation with new
methods of teaching : This includes experimentation with new instruments of
education such as film and radio .
Recruiting, selection, and education of teachers : This includes the education
of teachers already in service as well as work with prospective teachers.
Study of youth : This includes studies of the special needs of various racial
and economic groups as well as studies of the needs of all young people for
normal physical, intellectual, and personal developments .
Again the organizations selected were the Progressive Education
Association, the National Education Association Department of
Secondary School Principals, and the American Council on Education
as well as the National Council of Parent Education, the American
Youth Committee, and Teachers College of Columbia University .
193637 annual report
Pages 63-65 : Dr. Robert J . Havighurst, director for general- edu-
cation, made some interesting comments in this report . After
describing the evolution of the high school from the traditional func-
tion of preparing a small selective group for positions in business and
industries and another for institutions of higher learning to the educa-
tion of the mass of youth for more effective living . He states
The kind of reorganization that the secondary schools must undergo is deter-
mined by social change in two different ways . As just indicated, social change
has brought young people of the most diverse capacities and interests into the
secondary schools which must develop a program to meet their needs . In ad-
dition, social change is making new demands upon all people for understanding
human nature and society * * * for social change has made it necessary
to discard to a large extent old ways of living, many of which could be managed
by instinct, habit, tradition, and sheer untrained power * * * While we do not
need to develop new physical organs and adapt old ones to the new life, we do
need to develop new ways of living and to modify old ones . In this process a
reorganized program of general education can play an important part.
* * * one of the most significant things about the actions of educators and
educational organizations in this connection is their concern for making a re-
organized general education serve to help young people develop a loyalty to demo-
cratic ways of living and a confidence in democratic methods of solving social
problems .
He goes on to state that both the National Education Association
and the Progressive Education Association feel responsible for saying
in definite terms what they believe the ideals of democracy to be and
how education should be organized to lead to the realization of these,
ideals .
These comments are particularly significant in the light of the ac-
tivities of the National Education Association and the Progressive
Education Association under what they term "democracy ."
1937 38 annual report
Pages 66-69 : Dr. Havighurst, after pointing out some of the defi-
ciencies of the high school insofar as the mass of young people were
concerned, because the curriculum was geared to the requirements of
the minority, pointed out that while the board could not commit itself
to any one approach to these problems, it did extend assistance to a
number of responsible and representative organizations with the idea
of formulating what, in their opinion, are the underlying purposes of
a general education for young people and following that to recommend
a series of changes calculated to make "the systematic care and educa-
tion of youth serve these purposes better ."
The board gave as its reasons for selecting the American Council
on Education, the National Education Association, the Progressive
Education Association, and the regents of the University of the State
of New York the fact that "no truly representative canvass of existing
knowledge and points of view on the problems of youth could have
been made without the participation of these groups."
While Dr . Havigburst felt that the unanimity of these groups in
recommending a thoroughgoing reorganization of general education
at secondary levels was remarkable such unanimity would actually
appear to be only the logical result of the close cooperation and joint
projects of these groups and others, including Columbia University
and Teachers College .
The board went on to give grants to those organizations which it
considered to be factfinding and deliberative and these were the same
groups which had done the preliminary studies.
In his report, Dr . Havighurst made the following comments on the
work of the American Historical Association, after referring to the
various deliberative committee reports which had been effective in
shaping American public education during the years roughly of the
board's operations
The present decade has produced several committees whose reports may be
ranked with those of previous decades . Four years ago the commission on social
studies of the American Historical Association published an important series of
books dealing with the teaching of social studies in the schools . The committee
on orientation of secondary education (a committee of the Department of Second-
ary School Principals of the National Education Association) has produced two
reports-one on the Issue of Secondary Education and othe other on the Func-
tions of Secondary Education. The Federal Government's Advisory Committee
on Education is now issuing a series of statements on its various inquiries . To
these documents may now be added reports coming from several groups which
have reecived aid from the General Education Board .
He goes on to discuss the reports of the regents' inquiry as to the
character and cost of education in New York and those of the Ameri-
can Youth Commission 35
One of the most important results was the issuance of three major
statements on educational policy by the Educational Policies Commis-
sion of the National Education Association entitled "The Unique
Function of Education in American Democracy," Charles A . Beard ;
the "Structure of Education in American Democracy," b y George D .
Strayer ; and "The Purposes of Education in American Democracy,"
by William G. Carr, secretary of the National Education Association .
193839 annual report
Pages 87-93 : Referring to the board's program in the fields of gen-
eral education through the American Youth Commission of the
American Council on Education, the Educational Policies Commission
"How Fare American Youth? Homer P . Rainey ; Secondary Education for Youth in
America, Harl Douglass ; Youth Tell Their Story, Howard M . Bell.
54610-54-5

698 TAX-EXEMPT FOUNDATIONS'
of the National Education Association and the Commission on Sec-

ondary School Curriculum of the Progressive Education Association
and the inquiry staff of the New York State Board of Regents (report-
ing that much of the work had been completed or was nearing com-
pletion) Dr. Havighurst continues : "And is now serving not only as
a basis for changes in the curricula of many secondary schools but as
an incentive to experimentation with a variety of procedures for the
care and education of young people ."
Page 93 : Dr . Havighurst, referring to the activities of the board

states
Aid to experiments with the curricula of secondary schools and junior colleges
and evaluation of the results of such experiments has been an important part of
the board's work in general education . Grants for work in this area have included
such undertakings as the Progressive Education Association's 8-year experimental
study of the 30 schools, the American Council on Education's Cooperative College
Study, and the Michigan Secondary School Curriculum Study * * * . The inter -
est was continued by appropriations that year including a continuation of the
National Education Association civic education project, one of the major objec-
tives of which was the improvement of civic education in the United States with
particular stress on the importance of developing in young people an intelligent,
appreciative, and active loyalty to democracy .
194,0 annual report
Page 4 : A total of some $8,500,000 had been appropriated, the effects
of which, the report states, it was too early to judge . But the report
continues
But it can be said with considerable assurance that the studies and experi-
ments which have been aided by the board under its program in general education
have made significant contribution toward a better understanding of the problems
of youth in an age of rapid social change * * * . Undoubtedly, projects aided by
the board had stimulated a widespread interest in the development of ways for
improving the care and education of young people ; they have built up a new and
much-needed body of organized psychological, physiological, and social knowledge
about youth ; and they have set in motion systematic planning on the part of insti-
tutions and national organizations for a continuing consideration of problems
involved in the preparation of youth for the democratic way of life .
Page 76 : Dr. Havighurst once again devoted a special section of

his report to discussing the program in child growth and development
which the board had been supporting since 1933, continuing the inter-
ests evidenced by the Laura Spelman Rockefeller Memorial . From
1933 to the close of 1940, $1,032,888 had been appropriated for studies
of adolescents ; $519,543 for studies of infancy, and $173,000 for fel-
lowships, conferences, and special studies . In 1940 the board re-
moved the earmarkings of the various sums which prior to that time
had been segregated for different phases of the board's programs and
that year, 1940, also marked the end of the general education program
which began in 1933 .
194 .9 report
Page 34 : Referring to the National Citizens Commission for the
Public Schools, the report states
Among the most promising projects for rehabilitating the public schools was
that begun during the year by the National Citizens Commission for the Public
Schools, New York . This laymen's commission was established upon the advice
of a number of leading educators, and under the chairmanship of Mr . Roy E .

Larsen and is arousing latent grassroots interests in the improvement of public

education . By means of studies, conferences, printed materials, addresses and
publicity the committee intends to bring about community participation in
behalf of better school administration, better instruction and more generous
support for local educational needs . In publicizing examples of good school and
community practices, the Commission hopes to assist thousands of communities
in their efforts to build stronger schools . This is the first laymen's attempt to
deal with this important educational problem . Toward expenses of its first
year, the board appropriated $50,000 .
1950 annual report
Page 45 : The following year, reporting on this commission the re-
port states : "The Commission has stimulated group action by example
rather than by direction ." Good practices have been publicized, con-
ferences and study groups have been encouraged, and in response 973
local citizens' committees have been set up across the country to deal
with local school problems . The report goes on to state that regional
offices have been established and subcommittees set up, and the board
appropriated $75,000 for use over the next 2 years .
COLLEGES AND UNIVERSITIES
1902-14 report
Pages 142, 143, 148 :
The three main features of the policy of the general education board in deal-
ing with higher education may therefore be expressed as follows :
(1) Preference for centers of wealth and population as the pivots of the sys-
tem
(2) Systematic and helpful cooperation with religious denominations ;
(3) Concentration of gifts in the form of endowments .
The board tentatively decided that an efficient college should enjoy
are income from endowment covering from 40 to 60 percent of its
annual expenditures and from these and subsequent reports it would
appear that grants from the board were held out as an incentive to
institutions to put themselves in this financial position . This proce-
dure is in no wise unusual and was contingent upon the institution
itself raising matching or greater sums . And again, no criticism is
made of this approach, that such grants were in education fields, and
selected educational fieldss and somewhat too, selected educational in-
situtions, is only pertinent in relation to this question .
Another item which the board refers to as safeguarding the property
of the institutions was to give special attention to the business meth-
ods of the institutions to whom grants were made and on this point
the report states : "* * * The board was indeed bound to exercise as
much care in the distribution of its income as in making investment of
its principal . For this reason, the business management of colleges
applying for contributions has been carefully scrutinized with a view
to suggesting such improvements as might be advisable ." From this
it is reasonable to assume the board at least to a degree decided upon
what were efficient methods .
The board itself admits that its grants were in the nature of incen-
tive grants, and of this there can be no doubt, and at this stage in its
operations the board also freely admitted that many years would have
to elapse before the main task in which the board was assisting could
even be approximately completed, but it felt that the board's gift
served an indispensable purpose as leverage .
Until 1915 the board's activities were grouped into the following
divisions
(1) Appropriations for colleges and universities
(2) Medical education
(3) Education in the Southern States, including white rural schools, Negro
rural schools, and secondary education .
(4) Farm demonstrations
(5) Educational research
In the following years the title selected was somewhat different,
but the fields of activity remained practically the same, with profes-
sional education becoming a section around 1920.
LINCOLN SCHOOL
1916-17 report
Pages 48-49 : This report contains the first mention of the grants
made to Lincoln School, and the board states that this is an example
of the service that can be performed in "support of educational experi-
ments ." It goes on to state that the Teachers College of Columbia
University had requested the board to provide the funds needed to
conduct a school which endeavored "to organize a liberal curriculum
out of so-called modern subjects." The report compared this to its
work in the farm demonstrating program and added : "In addition
to its primary and essential task-that of endeavoring experimentally
to construct another type of education-the Lincoln School will, in
the judgment of its promoters, assist in developing a critical attitude
throughout the field of education ."
19.4-25 report
Page 21 : The board decided that year that the Lincoln School had
a permanent function to perform and it made initial appropriation of
$500,000 to Teachers College toward endowment . Referring to its
activities later,36 the board states : "During recent years the appro-
priations of the board to colleges and universities have been mainly
directed to the development of graduate activities ." And declaring
that a fine line cannot be drawn, it continues : "The board is now look-
ing to the development of graduate instruction and research ."
Pages 36-37 : In reporting its appropriation of $500,000 toward the
endowment of Lincoln School, at the discretion of Teachers College,
the board quotes from the annual report of Dr . Russell, dean of
Teachers College, as follows
Eight years ago, with the support of the general education board, we estab-
lished the Lincoln School for the purpose of experimenting with the materials
of instruction and methods of teaching suitable to a modern school . The success
of the undertaking has exceeded all expectations from the standpoint both of a
school and of an experiment station .
SUMMATION
Based on the foregoing :
1 . The board contributed large sums of money to projects in the
educational field.
2. In the course of its activities the board has made grants to the
American Council on Education, National Education Association, and
31 1927-28 annual report .
the Progressive Education Association and others in the following
amounts
Universities, colleges, and schools in the United States $257,157,581
For adult education .50,000
Columbia University' (7,607,525)
Cooperative test service, Education Records Bureau, graduate
record, college entrance examination board 3,483,000
Lincoln School of Teachers College' (6,821,104)
National Citizens Commission for the Public Schools 150,000
Progressive Education Association 4,090, 796
Teachers College' (11,576,012)
University of Chicago (118, 225,000 )
Total 270,750,694
'Grants to these institutions are included in amount shown for universities, colleges,
and schools .
THE ROCKEFELLER FOUNDATION
As mentioned in the section dealing with the board, the foundation

was the last agency created by Mr . Rockefeller which is still in exist-
ence . The amounts and dates of his gifts to the foundation 31 were
1913 $34,430,430.,54
1914 65, 569, 919 .46
1917 25, 765, 506.00
1917 5,500,000 .00
1918 • 1, 000, 000 00
1919 50,438, 768.50
1926 37, 000.00
1927 109,8.56 . 40
Subtotal • 182, 851,480.90

1929 88 182, 851, 480.00
Total 241,608,359.74
The foundation's affairs are under the direction of a board of 21
trustees, elected for 3 years, and its charter 40 states as its purpose "To
promote the well-being of mankind throughout the world ." As of
December 31, 1952, its assets were $167,890,851 .75 and its income for
that year was $16,893,519. Both principal and income may be spent .
According to the information filed with the Cox committee 41 by
the foundation, its expenditures from May 22, 1913, to December 31,
1952,42 were
For land, buildings, and fixed equipment $48,232,370
For endowment and capital funds 70,003,956
For current support of institutions, agencies, projects, and fellow-
ships 340,101,279
Total 458,337,605
For 15 years after its creation the foundation placed its major
emphasis on public health and medical education, although a division
87 This term will be used in this section to refer to the Rockefeller Foundation .
"Funds from the Laura Spelman Rockefeller Memorial .
894° Annual report for 1952 gives $316,220,394 as received from donors.
Incorporated by special act of New York State Legislature, 1913 .
41 And incorporated in annual report for 1952, latest available .
42 Does not include expenditures of Laura Spelman Rockefeller Memorial prior to
consolidation .
of studies had assigned to it several miscellaneous interests, including

the training of nurses, aid to dispensaries, human aspects of biology,
and anthropology . In time its programs and those of the other Rocke-
feller agencies began to overlap, and in 1928 after an extended study
a ,plan was evolved whereby all programs of the four Rockefeller
boards relating to the advance of human knowledge 43 would be
concentrated in the foundation.
The expenditures of the foundation from 1913 to December 31,
1952, infields of major interest were
Appropriations for the social sciences, humanities, medicine and
public health, and natural sciences and agriculture have been
excluded 44
While the foundation as mentioned has disclaimed any credit for
results, we can assume that their contributions would not have con-
tinued had there not been some measure of approval of the activities
and the results . Here again, since the foundation is an operating
agency only in the field of public health and agriculture, the results of
the agencies selected for contributions are pertinent, and particularly
insofar as there have been traceable and evident effects in the educa-
tional field as the result of the agencies' activities, they are attributable
to the foundation itself.
The work of the agencies aided by the foundation have already
been described briefly elsewhere, with the exception of the Institute
of International Education, which is quite evidently in the field of
education, and that description will not be repeated here . It is suffi-
cient to state that the results of their activities are apparent .
Public health and medical sciences $227,981,638
Natural sciences and agriculture 43,335,198
Social sciences 63, 775, 805
Humanities 26,816,321
Total 361,908,962
The foundation, as well as the board,46 sought to influence higher
education largely through the universities and the associations of
learned societies, but no attempt will be made to cover the contribu-
tions of the foundation or the board to the latter group of organiza-
tions. According to Dr . Hollis,47 the foundation profited by the
experience of the Carnegie Foundation for the Advancement of
Teaching (whose methods in this field have been discussed earlier)
and thus avoided much of the criticism that was directed at that
agency. Perhaps another reason was that the foundation came into
being after a decade of public awareness, but it should be noted that
at its inception the foundation was subjected to severe attack when
it applied for a congressional charter, and (although the board had
been granted one in 1903) so great was the opposition that the matter
was dropped .
For whatever reason, the annual reports of the foundation are much
less outspoken in their evaluation of their activities and merely state
in narrative and statistical terms the grants made each year . How-
43 Later expanded to include the dissemination and application of knowledge .
a* Any overlapping is very slight and does not affect the validity of these figures
.
a Does not include $55,339,816 disbursed by Laura Spelman Rockefeller Memorial prior
to consolidation in 1929 .
+e This term will be used throughout this section to refer to the Rockefeller General
Education Board.
41 Philanthropic Foundations and Higher Education .
ever, a glance at these grants over the years will substantiate the state-
ment that the foundation has been active in the field of education
throughout its existence and in some specialized aspects (such as
teacher training and the like) it has been particularly active since the
early thirties.
Moreover, this is confirmed by the extensive answers of the founda-
tion's Cox committee questionnaire (sec . E) 48 In the preliminary
comment to that section there is a statement of the policy of the
foundation which can be summed up in the last sentence : "We are
ready to state what we have done, but much of the assessment of its
worth must be left to others ."
1948 annual report
Page 7 : Within recent years there has been a brief statement which
conveys the foundation's own estimates :
The chartered purpose of the foundation with its wide scope and its absence
of preconceived or specialized interests has in a quite informal and undersigned
manner caused the foundation to become one of the crossroads of the scientific,
educational, and scholarly world.
SUMMATION
In addition to its direct grants to colleges and universities, the

foundation appropriated the following sums from 1929-52 :
Universities, colleges, and schools in the United States 1 (esti-
mated) $335,000,000
For adult education 3,435,500
Columbia University (1929-52) 33,300,000
Institute of International Education 1,406,405
London School of Economics 4,105,592
Teachers College 1,750,893
University of Chicago '60,087,000
Total 440,352,890
1 Does not include appropriations made to Chicago University, Columbia University,
Teachers College, or the London School of Economics .
' Includes grants of $35 million by John D. Rockefeller, Sr .
While the greater portion of its expenditures have been in the field
of university and college education, it has also contributed to the work
of the American Council on Education, the National Education Asso-
ciation, and the Progressive Education Association (as shown by the
foregoing table), and also to adult education generally .
Question 3 . It is apparent that each of the Carnegie and Rocke-

feller agencies referred to have carried on activities at all levels of
education, either as an operating agency or through its choice of
institutions and other organizations.
Among the organizations selected have been : The American Coun-
cil on Education, the National Education Association, and the Pro-
gressive Education Association, the Institute of International Edu-
cation and the National Citizens Commission for the Public Schools .
48 P . 79 of Rockefeller Answers to Questionnaires .

The American Council on Education is in the nature of a coordi-

nating agency between the Government and educational institutions
and organizations, but also carried on projects which affect education
at all levels .
The National Education Association and the Progressive Educa-
tion Association concentrate on primary and secondary schools .
The Cooperative Test Service, the Educational Records Bureau, and
the Graduate Record and College Entrance Examination affect edu-
cation at all levels .
The Institute of International Education carries on its activities in
secondary schools and at college and university levels.
There is considerable evidence that the efforts of the first three
of these organizations, to a greater or lesser degree, have resulted in
standardization of methods, both as to teaching (including testing
and training of teachers) and administrative practices in the field
of education.
Even those not in the educational field recognize that today there is,
in effect, a national set of standards of education, curricula, and meth-
ods of teaching prevailing throughout the United States . As a prac-
tical matter, the net result of this is nothing more nor less than a
system of education which is uniform throughout the country . More-
over, in the case of the National Education Association, one of its
goals for the "united teaching profession in 1951-57," is stated on page
13 of the National Education Association Handbook for 1953-54
to be
A strong, adequately staffed State department of education in each State and
a more adequate Federal education agency .
* * * s * *
Equalization and expansion of educational opportunity including needed State
and national financing .
The Carnegie and Rockefeller Foundations mentioned have con-
tributed $20,249,947 to these four agencies (or almost 9 percent of the
total of all their grants in this field of activity) ; 49 and since the sup-
port has continued up to now it indicates approval and sponsorship
of the activities of these agencies and their results .
Among the institutions selected have been : Chicago University,
Columbia University (including Teachers College) and the Institute
of International Education, and the London School of Economics .
These institutions have received contributions amounting to $194,
100,589, or approximately 22 percent of the total grants to all uni-
versities, colleges, and schools, including the amount contributed to
pension funds by the Carnegie foundations. If the pension funds
are excluded, then the contributions represent 27 percent of the funds
given universities, colleges, and schools .
ks Excluding grants to universities, colleges, and schools .
In addition, with the exception of the Rockefeller Foundation, all
contributed to the various testing and accrediting agencies which were
finally merged into the Educational Testing Service (aided also by
grants from these foundations) .
The amount and distribution of the appropriations are summarized
in the tabulation following
[In millions of dollars]
Carnegie Rockefeller
Total
Corporation Foundation Board Foundation
Universities, colleges, and schools in the

United States 56.838 62 .764 257.158 335.000 711 .760
Adult education 3.013 .050 3.436 6 .499
American Council on Education 1 .013 .092 4 .841 1 .236 7 .182
Columbia University 2 .687 ------------ 7 .608 33 .300 43 .595
'Cooperative Test Service, Educational
Records Bureau, Graduate Record,
College Entrance Examination Board--- .091 2 .850 3 .483 ------------ 6 .424
Institute of International Education 2 .366 ------------ ------------- 1 .406 3 .872
National Citizens Commission for the
Public Schools .750 ------------ .150 1 .000
National Education
--------------------------
Association .262 .115 .979 .032 1 .388
Progressive Education Association .076 .092 4 .091 ------------ 4 .259
Teachers College 3 .728 ------------ 11 .576 1 .750 17 .054
University of Chicago 2 .420 ------------ 118 .225 60 .087 180 .732
Lincoln School of Teachers College ------------ 6 .821 ------------ 6 .821
London School of Economics ------------ ------------ .106 4 .106
Total --------- --- ------------ 994.492
The quotations already given from the various reports relate also
to this question regarding the effects of foundation activities in educa-
tion, and therefore only 1 or 2 additional references will be included .
Probably the most recent self-evaluation by one of this group is that
contained in the 1952 Report of the Carnegie Foundation for the
Advancement of Teaching, at page 14 :
1952 report
Page 14
One of the developments which has produced the most lively debate in educa-
tional circles has been the widespread movement to reinvigorate the ideals
embodied in the term "liberal education ." The goal is rather widely accepted,
but there is substantial difference of opinion as to how to achieve it . The gen-
eral educationists offer a variety of curricular reforms. Advocates of the great
books press their claims for the wisdom of the past. Humanists decry the shift
of interest from certain disciplines to certain other disciplines . Our colleges are
literally awash with formulae for salvation ; all of which is healthy and part of
the process of getting things done in a democratic, heterogeneous, and always
vigorously assertive society .
' * * President Conant and his coworkers at Harvard have provided leader-
ship in this direction with their efforts to develop a new approach to the teach-
ing of science as a general education course . During the current year the corpo-
ration made a grant to Harvard for the continuation of this work .
54610-54- 6
The social sciences also have a significant role to play . Serious men cannot
accept the view of those humanists who rhapsodize over platonic generalizations
about society but resent the efforts of the modern social scientist to test these
generalizations * * * .
* * * Developments such as the new American studies program at Barnard
College (see p . 19) and the courses in Asiatic civilization at Columbia University
(see p. 21) would be impossible without vigorous participation, indeed, vigorous
leadership, on the part of the humanistic fields . But there is nothing in the
humanistic fields which offers a guaranty of salvation . They, too, have turned
out narrow technicians when they might have been turning out education men .
They, too, have often ignored the central concerns of liberal education .
A statement on this point made in the early years of its existence is
found on page 87 of the 1902-14 Report of the General Education
Board under the heading "Favorable Legislation"
It can fairly be said that in framing and putting through this legislation, the
high-school representatives supported by the General Education Board have in
every instance taken a leading part . They would, however, be the first to refuse
any undue credit. The organizations already mentioned-the Peabody Board,
the Southern Education Board, and the Conference for Education in the South-
had greatly stimulated the demand for adequate and orderly educational facil-
ities ; in every State, local bodies and organizations, State and local officials were
working along one line or another to arouse educational interest .
The section concludes with results in terms of increased schools,
buildings, and so forth, and the amounts appropriated by individual
States for new and improved buildings .
In a later report of the board (1939-40, p . 22) in a section entitled
"How Have the General Education Board's Activities Been Related
to These Happenings?" there is the following paragraphs
Board-aided projects have been associated with nearly all the changes de-
scribed above . It is obvious, however, that these changes have been called
forth by the broad social changes of the times, not by the educators, not by
educational foundations . If educational changes are well adapted to the broad
social changes of the times, they find a place and are incorporated in the
continuing social processes .
However, based on the records of the board itself, no other projects
which might possibly have resulted in "changes" b0 were selected
except those board-aided projects.
The board, in appraising its contributions to the American Council
on Education's Cooperative Study of Secondary School Standards
(1947-48 report, p . 113), wrote
Under an earlier program of the General Education Board appropriations were
made to the American Council on Education for the study of standards for the
secondary schools . The regional accrediting associations for whom the study
was undertaken were interested in developing methods of evaluation that would
take account of significant qualitative factors, so that less reliance would
need to be placed on the purely quantitative criteria in the evaluation of
secondary schools . The study committee worked out and tested new criteria and
procedures and published its conclusions in four volumes : How To Evaluate a
Secondary School, Evaluative Criteria, Educational Temperatures, and a General
Report . The committee anticipated that these materials and procedures would
need review and revision about every 10 years .
"a That is, those such as the Eight-Year Study, the Study of Secondary School Curriculum,
and the Cooperative Study of General Education .
Since 1938, almost 25 percent of the secondary schools of the country have
used the new procedures . In the Southern and Middlewestern States, especially,
criteria have been widely used and found helpful in raising the general level of
secondary education . Meanwhile, further educational research, experience
with war-training programs, and changing relations between secondary schools
and colleges have made a general revision of the criteria desirable . The accred-
iting associations have requested such a revision . An appropriation of $24,500
was made to the American Council on Education for use by a joint committee
of the accrediting associations toward the cost of revising the materials and
procedures developed in the earlier investigation .
While it is quite true that at the present time $1 billion is not par-
ticularly impressive when compared with endowments and Govern-
ment spending in related fields such as research and the like, two
things should be borne in mind . First, at the time the foundations
first began making grants to institutions and agencies, they were the
biggest and only contributors on that scale in the country. Second,
all have had the same policy of giving grants to inaugurate a particular
type of project or organization, withdrawing financial -aid when it
has become self-supporting or aroused the financial interest of other
individuals or groups . Dr . Hollis,sl writing about this phase of
foundation giving, states (excerpt from chapter 1, introduction, Phil-
anthropic Foundations and Higher Education, by Ernest Victor
Hollis)
Although foundations are important for the volume of money they distribute
to cultural undertakings, the essential nature of their influence is not in the
aggregate of their contributions . Rather it lies in the fact that the grants may
be large enough to provide the essential supplement necessary for foundations
to hold the balance of power. In the 1924 fund-raising campaign of 68 leading
universities there is an illustration of the powerful influence that foundations
may exert even when the amount they contribute is only a small percentage of
the total. They contributed only 18 .1 percent of the funds raised, but they were
reputed to have exerted a dominant influence on the purposes and plans of the
campaigns through being the largest single donors. The average size of grants
from foundations were $376,322.76 as compared to an average of $5,902 .75 from
individuals who gave $1,000 or more . About 3 .4 percent of the individual givers
contributed 59.3 percent of the total fund but because the average of their gifts
were not large enough to be considered an essential supplement, they were reputed
to have exerted a negligible influence in the policies and programs of these 68
colleges . If such vital and strategic potential powers are a possibility in
foundation activities, it should be known whether these new social institutions
are committed to a philosophy of social and cultural values in keeping with
the needs of a rapidly changing social order .
Dr . Hollis discusses the matter of foundation influence in education
at some length, and according to him foundations have influenced
higher education notably and increasingly "toward supporting social
and cultural ideas and institutions that contribute to a rapidly chang-
ing civilization * * * the chief contribution of the foundations
(being) in accelerating the rate of acceptance of the ideas they chose
to promote ."
51 Ibid, pp. 3- 4.
In his opinion the foundations had been "exercising the initiative

accorded them to spend most of their money on exploratory work that
seems only remotely connected with improving college education"
"on the theory that research must first be done in general education if
valid college reorganization is to be accomplished ."
He asks the question, "To what extent and in what direction has
higher education in the United States been influenced by the philos-
ophy, the administration, the activities, and the money of philan-
thropic foundations?" 52
In reply he writes
In order to answer one must consider not only the degree of educational control
or dominance that is exercised by the foundations, but also whether their activi-
ties indicate progressive participation in a living culture that looks toward the
future, or whether they indicate a static or even reactionary tendency that
attempts to maintain the existing social order . While categorical answers
cannot be given, enough evidence has been introduced to remove discussion from
the realm of biased assertion or mere conjecture .
To the question, "To what extent and in what direction has American
higher education been influenced by philanthropic foundations ?" 53
To what extent and in what direction has American higher education been
influenced by philanthropic foundations? An answer to the original question
may now be ventured. This study concludes that the extent is roughly $680
million and the direction increasingly toward supporting social and cultural
ideas and institutions that contribute to a rapidly changing civilization . Foun-
dations at the start were dissatisfied with existing higher education and they
have promoted programs that have, for the most part, been in advance of those
prevailing in the institutions with which they have worked . To a large extent
these ideas were originated by frontier thinkers within the professions ; the
chief contribution of the foundations has been in accelerating the rate of
acceptance of the ideas they chose to promote .
In contending that these ideas have been closer to the "growing edge" of Ameri-
can culture than were the university practices they proposed to supplant, no claim
is made that wiser choices could not have been made or that there has not been
occasional overemphasis of foundation-supported ideas, resulting in dislocations
and gaps in an ideally conceived pattern of progressive higher education . This
study has often been critical of individual ideas, policies, and persons, and has
illustrated the foundations' frequent lack of social awareness, their failure to
anticipate educational trends, and the presence of unavoidable human fallibility
in their official leadership .
The question then arises whether or not the activities of these foun-
dations in the field of education are in harmony with the constitutional
provisions with regard to education .
VIEWED IN RELATION TO THE CONSTITU ZION
"Education" is not directly referred to in the Constitution, nor in
any of the amendments. Under the taxing power as well as the pro-
hibition against discrimination, there have been cases in which the
question of educational opportunity or facilities was involved-that
is, in decisions as to the constitutionality of State statutes .
There is a long line of cases in which the scope and effect of the
10th amendment have been precisely delineated . It is well estab-
53 Ibid ., p . 282.
Ibid., pp. 294-295 .
lished that the reservation contained in that amendment can only be
interpreted to mean that, in effect, the rights of sovereignty which
the respective States possessed before the adoption of the Constitution,
and which they did not specifically relinquish by that document, are
expressly reserved to the individual States . It was drafted because
the framers of the Constitution and the Bill of Rights were well aware
that under the pressure of either "emergency" or "general welfare" the
National Government might attempt to assume powers that had not,
been granted . They were determined to leave no opening for such
an assumption, and thus, if further powers seemed necessary in the
future, they could only be provided for by amendment in the manner
set out in the Constitution .
At times it is erroneously stated that the 10th amendment provides
for a distribution of power between the United States and the States-
actually, properly stated, it is a reservation of power of the States .
This is readily understood when one recognizes that each of the States
(Colonies) was actually an autonomous political entity, prior to the
ratification of the Constitution. As such each has all the sovereign
powers (within its territorial limits) enjoyed by any foreign nation,
including unlimited jurisdiction over all persons and things.
Within its own borders, education, at every level of instruction, is
the sole province of each of the 48 States . This extends to the cur-
riculum, textbooks, teachers, and methods of instruction, as well as
standards of proficiency for both the student and the graduate .
The foundations, it is true, have taken the position that any stand-
ards they may have set have been in order to qualify for grants of their
funds-but, in their own words, they have had in view achieving a
uniformity and conformity of education and educational standards
throughout the country .
Each State has by statute prescribed the methods where changes
affecting its educational system shall be made, and in the case of
drastic changes the usual practice is to present the matter to the elec-
torate for its decision . From the records it is apparent that the foun-
dations did not follow the statutory provisions of the States relating
to education-and apparently it never occurred to any of them to con-
sult the authorities concerning those of their "educational" activities
which fell within the purview of State regulation . At any rate, at
no time did the individual States themselves (either through an
elected official or the electorate) have an opportunity to approve or
disapprove the changes brought about by foundation funds .
From a practical standpoint-and again it is emphasized regardless
of their merits-the changes have occurred ; now it is more difficult
to determine what the decision of the individual States would have
been then had they been consulted, particularly because many of them
(invaded as it were through the back door) have been "conditioned"
to the invasion, and would probably not display the same vigorous
opposition to the intrusion as might have been expected and forth-
coming when this encroachment on State powers first began .
KATHRYN CASEY,
Legal Analyst .
FRIDAY, JULY 9, 1954
HOUSE OF REPRESENTATIVES,
SPECIAL' COMMITTEE To INVESTIGATE
TAX-EXEMPT FOUNDATIONS,
Washington, D . C. P
Pursuant to resolution of the committee on July 2, 1954, at the in-

struction of the chairman, the balance of the staff report prepared by
Kathryn Casey, legal analyst, on the Carnegie and Rockefeller Foun-
dations, was incorporated in the record of proceedings .
( The report follows :)
SUMMARY OF ACTIVITIES OF CARNEGIE CORP . OF NEW YORK, CARNEGIE
ENDOWMENT FOR INTERNATIONAL PEACE, THE ROCKEFELLER FOUNDA-
TION
PREFACE
Comments made following presentation of the first part of this

summary of the activities of the Carnegie and Rockefeller philan-
thropic trusts indicate a rather widespread misconception among
foundation executives both as to the purpose of chronicling their
activities in certain fields, and also as to the requirements of House
Resolution 217-under which this and all other staff reports have
been prepared .
While varying somewhat in phraseology and manner of persen-
tation, the theme of these comments was essentially the same, namely
Why has the staff disregarded the many "good things attributable to
the foundations?
The best-and the only answer-is that the work of the staff, includ-
ing both research and the preparation of reports, has been carried out
in the light of the language in the enabling resolution by which the
committee
* * * authorized and directed to conduct a full and complete study of educa-
tional and philanthropic foundations * * * to determine if (they) are using
their resources for purposes other than (those) * * * for which they were
established, and especially * * * for un-American and subversive activities ; for
political purposes ; propaganda, or attempts to influence legislation .
There is no distinction here as between so-called good or bad activi-
ties of the foundations-nor is there a direction to scruitinize the
activities of foundations generally and report on them-only an
admonition pinpointed toward specified types of activities.
It has been with that in mind that reports and statements of the
Carnegie and Rockefeller organizations have been carefully studied,
as well as books written about them .
869
It has been with that in mind that the summary of their activities
has been prepared .
II
At the same time that Carnegie and Rockefeller agencies were con-
centrating on the "chaotic condition" of education in the United States
(discussed in I), organizations bearing the same family names
were focusing attention on other types of conditions which in the opin-
ion of the trustees required improvement . While these so-called prob-
lems covered such varied fields as public health, malaria in Africa,
and exchange of profesors and students of international law, there was
an indirect relationship between them, and also between them and
education : namely, all of them were on the periphery-if not directly
in the center-of international relations and governmental activities .
That both the foundation and the endowment did carry on activities
which would directly or indirectly affect legislation is borne out by
their own statements, as found in their annual reports .
That they both engaged in propaganda-as that word is defined
in the dictionary, without regard to whether it is for good or bad
ends-is also confirmed by the same source .
That both had as a project forming public opinion and supplying
information to the United States Government to achieve certain ob-
jectives, including an internationalist point of view, there can be no
doubt.
None of these results is inherent in the purposes of either of these
organizations.
Attached to this are abstracts from the yearly reports of both
organizations (identified as Exhibit-Carnegie Endowment for Inter-
national Peace and Exhibit-Rockefeller Foundation and arranged
chronologically), to which reference will be made from time to time
in support of statements as to the type of activity carried out by the
endowment, and occasionally short material of this nature will be
incorporated into the summary . This method has been chosen because
it will materially shorten the text of the summary itself, and still
give the members of the committee the benefit of having before them
statements made by both the endowment and the foundation .
As in part I, this portion of the summary of activities is concerned
only with stating what was done by the Carnegie and Rockefeller
agencies, the time of such activity, and the results, if any .
Purposes
The endowment by its charter was created to
* * * promote the advancement and diffusion of knowledge and understanding
among the people of the United States ; to advance the cause of peace among
nations ; to hasten the renunciation of war as an instrument of national policy ; to
encourage and promote methods for the peaceful settlement of international
differences and for the increase of international understanding and concord ; and
to aid in the development of international law, and the acceptance of all nations
of the principles underlying such law.
To accomplish its objectives the endowment had three divisions,
each having distinct fields of activity, particularly when originally
established, but as will be seen some of their operations have become
somewhat interwoven.
The primary objective of the division of international law was the
development of it, a general agreement-accepted by all nations- as
to its rules, accompanied by establishment of better understanding of
international rights and duties, and a better sense of international
j ustice.
The division of economics and history had its program outlined at a
conference at Berne which laid out a plan of investigation to reveal the
causes and results of war . Many of the topics bear a rather close
resemblance to effects now found in the national life .
The purposes for which the division of intercourse and education
was instituted were the diffusion of information, and education of
public opinion regarding, not only the causes, nature, cultivation of
friendly feelings between people of different countries and effects of
war, but also means for its prevention ; maintenance, promotion, and
assistance of organizations considered to be necessary or useful for
such purposes . It was first referred to as the division of propa-
ganda 1-a name changed at the time it was formally established .
This division from the beginning expended much more money than
did the other two divisions, or the office of the secretary .
Compared with the activities of the other two divisions in these early
years those of the division of economics and history were fairly routine,
although with the outbreak of the First World War it was to start on
what developed into some 30 volumes of the economic history of that
war . While some of the economic measures which were covered in
that history and in other phases of the divisions were significant in the
light of the types of controls which were established in this country
during the Second World War, it is really with the work of the other
two divisions that this summary will primarily concern itself, since
their activities were more often in the international relations, propa-
ganda, political, and government relations areas .
The Rockefeller Foundation has a much more general and more
inclusive purpose : "To promote the well-being of mankind through-
out the world ." There is scarcely any lawful activity which would not
come within that classification, and undoubtedly some proscribed by
various statutes in this country might conceivably still be construed
as for the "well-being of mankind" elsewhere .
Before 1929, as mentioned in the earlier portion of this summary,
the Rockefeller Foundation confined its activities primarily to the
fields of medical education and public health, with some attention
being given to agriculture. Except in the sense that activities in each
of these fields were carried on outside of the United States, they had
relatively nothing to do with "international relations," but in the light
of later activities of the foundation in connection with "one-world"
theories of government and planning on a global scale there seems little
doubt that there is at least a causative connection .
The activities of the foundation are now (and have been for some
time) carried on by four divisions : Division of medicine and public
health, division of natural sciences and agriculture, division of social
sciences (including a section entitled international relations), and
division of humanities .
It is impossible to discuss the activities of the endowment and the
foundation entirely by subject headings, because one merges into the
other, and therefore they will be discussed in relation to the following
International relations, governmental relations, political activities, and
propaganda .
1 Finch History .
54610-54-7
As mentioned earlier, the primary interests of these organizations

were in divergent areas, but from 1929 the activities of both the endow-
ment and the foundation were along more or less parallel lines-
although again the descriptive phraseology of the endowment is usually
much more direct than that of the foundation as will be seen by quota-
tions from annual reports of each organization .
Because of the characteristic similarity, graphically illustrated by
the chart at the end of this summary, the activities of both organiza-
tions from 1929 on will be discussed together . However, since the
endowment's program began prior to that time, details of it will be
included first.
Endowment activities-1911-29
The endowment was dedicated to achieving world peace and in
doing that it utilized every method it deemed appropriate and effective .
One method chosen was international law-and it immediately set
about to establish a coordinated national system of instruction through-
out the country in that subject . The 1930 yearbook, page 108, refers
to a meeting of international law and international relations professors
who met "in conference in order to discuss and to agree upon the best
methods to reach and educate the youth-primarily of the United
States-in the principles of international law and the basis of foreign
relations ."
In addition to international law, another method selected by the
endowment as a means of achieving international amity, was what
throughout the years is referred to in such terms as "education of
public opinion," "development of the international mind," "enlighten-
ment of public opinion," and "stimulation of public education ." This
last phrase it may be noted was used by Alger Hiss in his Recom-
mendations of the President, pages 16 and 17 of the 1947 yearbook,
in which he also recommended "most earnestly" that the endowment's
program for the period ahead be constructed "primarily for the sup-
port and assistance of the United Nations ." At times these phrases
were coupled with "diffusing information" or "dissemination of in-
formation" but more frequently they were not . This part of the
endowment's work was not confined to the United States-it also
selected material to be distributed abroad through various means,
and circulated foreign pamphlets on various subjects in this country .
There is little doubt that the endowment regarded its work as educa-
tional and as fostering world peace-and there is equally little doubt
that the work was in the international relations field, and consistently
of a propaganda nature . For example, as far back as June 1917 it
cooperated with the Academy of Political Science on a National Con-
ference on Foreign Relations of the United States, the stated purpose
being "to organize a campaign of education among the people of the
United States on the international situation then existing ."
Again in 1926 the endowment sponsored a conference on interna-
tional problems and relations-the aim being to "create and diffuse in
the United States a wider knowledge of the facts and a broader and
more sympathetic interest in international problems and relations ."
Several of the topics assume significance in the light of later events-
"International cooperation in public health and social welfare" and
"Economic adjustments ."
Viewed in the light of what the endowment did then and later in
its campaign of education, and "to create and diffuse * * * a wider
knowledge" as well as the agencies it chose to carry them out, these
early ventures seem rather .significant.
Throughout the years the reports cover such subjects as inter-
national relations clubs, international mind alcoves, international re-
lations centers, international economic cooperation, exchange profes-
sors, international visits, and the 'Like . Its relationship with the
American Association of International Conciliation continued until
1924 when its activities were merged with those of the division .
According to Dr. Finch that organization was selected by Dr . Butler
as "the chief propaganda agency of the division" (p . 446 of Finch
History) .
The endowment was really just getting started when the First
World War raised serious obstacles to its work abroad . However, be-
fore that event it had selected as "agencies of propaganda" (a name
later discarded) various of the peace societies, in which Mr . Carnegie
had been intensely interested .
However, some projects of importance were underway . The divi-
sion of international law had surveyed the situation existing with re-
gard to the teaching of that subject in colleges and universities in the
United States, and by the time war broke out in 1914 compiled a tabula-
tion showing the professors, instructors, and lecturers on international
law and related subjects during the collegiate year 1911-12.
The immediate result of this was placing the subject of fostering
"the study of international law" on the agenda of the American
Society of International Law in 1914, at the request of the endowment .
From that beginning grew the great influence of the endowment in
this field's increased facilities for the study of international law, uni-
form instruction differentiation between undergraduate and graduate
instructions, and inclusion of a host of "relatec ." subjects . According
to the Carnegie Endowment History by Dr . Finch, a check by the divi-
sion on the effects of its efforts showed the material increase both in
number of hours and the enlargement of classes which he estimates as
45 percent from 1911 to 1922, and a still further increase by 1928. He
also mentioned that in 1928 there were six former holders of the en-
dowment's international law fellowships teaching in foreign univer-
sities (p . 319 of the Finch History) .
Fellowships in international law
At the recommendation of the American Society of International
Law (made December 1916) the endowment established fellowships
for the study of international law and related subjects . There were
5 awarded annually to graduate students holding the equivalent of a
bachelor's degree and 5 to teachers of international law or related sub-
jects with 1 year of previous teaching experience .
A total of 212 fellowships were awarded from 1917 to 1936 (about
one-sixth bein renewals), of which 128 were to students and 84 to
teachers . Dr. F inch states that while complete records are not avail-
able, information in the files and in Who's Who as well as personal
contacts show that two-thirds entered the teaching profession and he
then continues (pp. 323 et seq.)
As the years went by, most of these teachers improved their positions . Some
became senior professors or heads of departments . Three became university
presidents : Colgate W. Darden, Jr ., is president of the University of Virginia ;

Norman A . M. MacKenzie became president of the University of New Brunswick
and later of the University of British Columbia ; Henry M . Wriston, after serving
as president of Lawrence College, is now president of Brown University ; 3
Bessie C . Randolph became president of Hollins College, Virginia, and Bernice
Brown (Cronkhite) is dean of Radcliffe College . Frederick S . Dunn, of Johns
Hopkins University, is now director of the Yale Institute of International Studies .
Two former fellows were elected to the United States Congress . Charles West, of
Ohio, and Colgate W . Darden, of Virginia . Mr . Darden then served as Governor
of Virginia before he accepted the presidency of the university of his State .
Leadership has been assumed by former international law fellows in the
organization and direction of community and regional centers in different areas
of the country for the promotion of international understanding and cooperation
in international organization. Keener C . Frazer, professor of political science of
the University of North Carolina, became director of the Southern Council on
International Relations . J . Eugene Harley, professor of political science at the
University of Southern California, became director for the Center for Interna-
tional Understanding at Los Angeles, and chairman of the Commission to Study
the Organization of Peace in the southern California region ; Charles E. Martin,
professor of international law and head of the department of political science
of the University of Washington, is chairman of the Institute of Public Affairs
of Seattle, and of the Northwest Commission to Study the Organization of Peace .
Brooks Emeny, of Cleveland, Ohio, was director of foreign affairs council of
that city, and then became president of the Foreign Policy Association in New
York . Another former endowment fellow, Vera Micheles (Dean) is the director
of research of the same organization .
Some 16 former fellows are now in the service of the Department of State
occupying positions of varying responsibilities . The most outstanding of this
group is Philip C. Jessup, now Ambassador-at-Large, and representing the Gov-
ernment of the United States in the United Nations and other important inter-
national conferences attempting to restore peace to the world . At least two
former endowment fellows who entered the military service were appointed to
responsible positions requiring a knowledge of international law . Hardy C .
Dillard, of the University of Virginia, was director of studies of the United States
Army's School of Military Government located at that university, and later occu-
pied the same position at the National War College in Washington . Charles
Fairman, of Stanford University, was Chief of the International Law Division of
the Office of Theater Judge Advocate in the European Theater of Operations .
Several former endowment fellows were selected by the Government to go on
cultural and educational missions to the occupied areas, and two of them served
as consultants to General MacArthur in Tokyo (Claude A . Buss of the University
of Southern California, and Kenneth W . Colegrove of Northwestern University) .
A former endowment fellow, Francis 0 . Wilcox, is chief of staff of the Senate
Committee on Foreign Relations, assisted by another former fellow Thorsten
Kalijarvi .
Of special interest is the career of John H. Spencer, of Harvard, after studying
under a fellowship . He was appointed legal adviser to Emperor Haille Selassie,
of Ethiopia before World War II. He returned to the United States and served
in the State Department and United States Navy while the Italian Army occu-
pied that country, and then returned to his former post in Addis Ababa at the
urgent request of the Emperor, supported by the Department of State . John
R . Humphrey, an international law fellow from McGill University, Montreal,
became Director of the Division on Human Rights of the United Nations Secre-
tariat.
He concludes with this statement
The immediate objective, namely, to provide an adequate number of teachers
competent to give instruction in international law and related subjects, and thus
to aid colleges and universities in extending and improving the teaching of these
subjects, was demonstrably achieved . From this selective educational group
have emerged leaders of opinion as well as of action in the conduct of inter-
national relations directed toward the goal for which the endowment was
founded.
2 Dr . Wriston was elected a trustee of the Carnegie Endowment for International Peace
in 1943 . He is also a trustee of the Carnegie Foundation for the Advancement of Teaching
and of the World Peace Foundation . He holds membership in several learned societies, is
a former president of the Association of American Colleges and president of the Association
of American Universities .
At the same time, the division of intercourse and education was set-
ting out on a policy stated by Dr . Butler to be
To lay little stress upon those aspects of peace propaganda that are primarily
rhetorical and feeling in character, but rather to organize throughout the world
centers of influence and constructive policy that may be used in the years to
come as the foundation upon which to erect a superstructure of international
confidence and good will and therefore of peace .
In view of the division's activities later in behalf of the League of
Nations and the United Nations, this has a somewhat prophetic ring .
Compared with the activities of the other divisions, the activities of
the division of intercourse and education were much more varied, and
the yearbooks contain innumerable references to its activities which
indicate that they were more concentrated in the fields covered by this
summary .
One.of the very first actions of the division in 1911 was the appoint-
ment of special correspondents throughout the world to report on con-
ditions in their respective countries and on public opinion here regard-
ing international problems between their governments and other
nations . When, in the opinion of the division, it was proper, extracts
were given to the American press . The decision of which to give and
which to withhold was entirely within the discretion of the division,
and that undoubtedly meant Dr . Butler. In view of his intense desire
to achieve peace, and his equally firm conviction that an international
organization could best accomplish that, it is entirely conceivable that
his judgment as to the material to be released might be influenced by
his own convictions and desires-and this would be equally true in the
case of any human being .
The correspondents also made the endowment's work known in their
countries through the press, interviews and speeches, and officially
represented it at undertakings of international cooperation and under-
standing .
This system was discontinued,in 1930 because by that time the di-
vision had established-
such a network of worldwide connections involving continuous correspondence
as to make it no longer necessary to employ the services of special correspondents .
Just after the war started in 1914, the division engaged prominent
persons to lecture before colleges, chambers of commerce, clubs, and
similar audiences on the subject of past and present history as it related
to current international problems . Among the speakers were David
Starr Jordan, Hamilton Wright Mabie, and George W . Kirchwey .
Dr. Butler instructions as to the endowment's purpose in sponsoring
these lectures were,
This work is to educate and enlighten public opinion and not to carry on a special
propaganda in reference to the unhappy conditions which now prevail throughout
a large part of the world. It is highly important that purely contentious ques-
tions be avoided so far as possible and that attention be fixed on those underlying
principles of international conduct, of international law, and of international or-
ganization which must be agreed upon and enforced if peaceful civilization is to
continue (letter to Dean Frederick P. Keppel, May 28, 1915-16 yearbook, p. 67) .
International mind alcoves
These were described in the yearbook of the endowment and typical
references are given in the exhibit. Following the entry of the United
States into World War I a systematic purchase and distribution of
books and pamphlets dealing with international relations generally
and the causes and effects of war, as well as the possible terms of eace,
was begun by the division of intercourse and education . Dr . Butler
is generally credited with coining the phrase "international mind" and
from the time the distribution to libraries was begun they were known
as "international mind alcoves" and so referred to in the annual
reports.
The endowment has described the books selected and distributed by
it as "authoritative and unbiased books of a type suitable to interest
the general reader dealing with the daily life, customs and history of
other countries." In that connection, among the books distributed to
these alcoves and to the international relations clubs (and interna-
tional relations centers) are those referred to in a memorandum which
forms an exhibit to this summary, and is entitled "Exhibit-Carnegie,
Books Distributed ." The endowment has contributed $804,000 to
this activity . Dr. Colegrove's comments on some of these volumes
indicate there was only one viewpoint presented-that of the one
world internationalist-and books written from a strictly nationalist
point of view were not included .
International relations clubs and conferences
These clubs in the United States were in part, an outgrowth of
groups of European students organized by the World Peace Founda-
tion, and known as Corda Fratres . The endowment at the request
of the World Peace Foundation contributed to the Eighth Interna-
tional Congress of Students, and the following year (1914) the di-
vision of intercourse and education began to actively organize what it
described as International Polity Clubs in colleges and universities
throughout the country, for the purpose of stimulation of interest in
international problems in the United States . The name was changed
in 1919 to International Relations Clubs, and while interest diminished
for a few years after World War I, the clubs began a steady annual
increase before too long, which has been sustained to the present time .
About 1924 the first conference was organized of a federation of
clubs in the Southern States, which became known as the Southeast
International Relations Clubs Conference . The idea quickly spread
and a dozen such regional centers were formed . (From 1921 until 1'946
the endowment contributed $450,425 toward this program .)
Here again the purpose of the endowment is stated (International
Relations Club Handbook, 1926) to be :
to educate and enlighten public opinion . It is not to support any single view
as to how best to treat the conditions which now prevail throughout the world,
but to fix the attention of students on those underlying principles of interna-
tional conduct, of international law, and of international organization which
must be agreed upon and applied if peaceful civilization is to continue .
However, mere statement of purpose as frequently pointed out by
the Bureau of Internal Revenue is not sufficient-the activities must
follow the purpose ; and those of the endowment do not bear out its
statement "not to support any single view ." Throughout its reports,
by the books it has distributed, by the agencies it has used for various
projects, by the endowment graduates which have found their places
in Government-the endowment has put forward only one side of the
question, that of an international organization for peace . It has not
sponsored projects advocating other means .
The endowment's evaluation of these clubs is contained in frequent
references in its reports, only one of which is included in the Exhibit-
Carnegie, that from the yearbook for 1943, pages 37-38 .
Dr. Johnson in response to a letter requesting information as to
the formation and activities of these clubs, wrote the committee on
April 29, 1954, and both the request and the reply are included in
Exhibit-Carnegie .
These clubs were formed in 1914 and have operated for 40 years in
colleges, universities, and high schools. In 1938 according to Dr.
Johnson there were 1,103 clubs : 265 in high schools and 685 in col-
leges and universities throughout the United States ; with 11 scattered
in the Philippines, Hawaii, Alaska, Canal Zone, and Puerto Rico ; 24
in the United Kingdom, 34 in 14 Latin American countries, 22 in
China, 9 in Japan, 2 in Korea ; and the remaining' 51 in Canada,
Egypt, Greece, Iran, Iraq, Siam, New Zealand, Australia, South
Africa, Syria, and India .
Dr. Johnson's concluding statement that "a contribution was made
to a better understanding of the responsibilities which our country
now bears as a world power" is quite understandable under the cir-
cumstances . Some of the other aspects of these clubs will be discussed
in connection with the Foreign Policy Association .
Visiting Carnegie professors
In addition to the exchange professors of the division of interna-
tional law the division of intercourse and education in 1927 initiated
its own plan of exchange professors. It was inaugurated by sending
abroad the directors of the other two divisions as visiting professors
that year, Dr. James Scott Brown going to lecture at universities in
Latin America and Spain, and Dr. James T. Shotwell being sent to
Berlin. The other prominent Americans closely identified with this
field who went abroad to represent the endowment were Dr . David P.
Barrows, former president of the University of California, and an
elected trustee of the endowment in 1931 ; and Dr. Henry Suzzalli,
former president of the University of Washington at Seattle and
chairman of the board of the Carnegie Foundation for the Advance-
ment of Teaching . The exchange professors were not restricted to
international law and political science, but included professors of
public law, history, and other subjects .
The endowment also arranged for European tours for newspaper
editors, and a reciprocal tour of the United States for a group from
Europe.
Political activities
In addition to these projects already described, the endowment quite
early in its career, (1913-14) had a brush with the United States Sen-
ate regarding Senator Root's statements on the floor of the Senate
during the controversy over exemption of American coastwise vessels
from payment of Panama Canal tolls .
The Senate Committee on Judiciary was directed to investigate
the charge that "a lobby is maintained to influence legislation pending
in the Senate ." (Pt . 62, March 13, 1914, pp. 4770-4808 .) Apparently,
there had been some question as to whether the exceedingly widespread
distribution of the Senator's speeches by the endowment had been at
878 TAX-EXEMPT FOUNDATION$
Government expense . In his history, Dr . Finch discussing the incident

says :
There was little real need for any outside investigation of the work of the
endowment . From the beginning the trustees regarded themselves as the admin-
istrators of a quasi-public trust fund . Complete accounts of all activities and of
expenditures detailed as much as practicable within reasonable printed limits,
were published annually in the yearbook beginning with 1911 . In it were given
the names of the trustees, officers and membership of committees, and the full
texts of the reports of the executive committee, the Secretary, the treasurer,
and of the directors of the three divisions . Summaries were published in the
yearbook of the meetings of the board of trustees, with the texts of their
resolutions and the amount and general purposes of their appropriations . Lists
with bibliographical data were added of all endowment publications up to that
time. The yearbook was obtainable free of charge upon application . It had a
regular mailing list of 5,000 to 10,000 addresses, which included all the important
newspaper offices in the United States and many in foreign countries .
The endowment also actively advocated passage of the reciprocal
trade agreements legislation, adherence to the Anglo-American agree-
ments and carried on various other activities of a political nature, as
the extracts from their annual reports confirm .
After World War I the endowment's trustees seemed to have been
divided in their ideas on how best to begin anew their efforts to build
a peaceful world . Some members of the board were still of the opinion
that international law, arbitration treaties and the like offered the
greatest hope, while others looked to an "international organization"
of nations, as the best means to accomplish this objective .
The matter was resolved, officially at least, by the endowment putting
its strength behind the League of Nations or failing that, adherence to
the World Court . Here again, the attitude and activities of the
endowment can be readily ascertained by reference to the exhibit in
which only a few of the many such statements have been included .
Early in its career the endowment began the close working arrange-
ments with the Federal Government which have continued down to
the present time . Immediately after the United States entered World
War I the trustees passed a resolution offering to the Government "the
services of its division of international law, its personnel and equip-
ment for dealing with the pressure of international business incident
to the war ."
The Secretary of State first asked that the division translate and
publish the complete text of the proceedings of the two Hague Con-
ferences and preliminary copies were made available to the American
Commission to Negotiate Peace at Paris in 1918 . The division also
aided in the preparatory work for the peace conference, and the mate-
rial for the use of the American delegation was selected (at a cost of
$30,000 paid by the endowment) by a committee of three appointed by
the Secretary of State-the director of the division of international
law, the Solicitor of the Department, Lester H . Woolsey, and a special
assistant in the Department, David Hunter Miller . Much of the
material was the work of regular division personnel and all manu-
scripts were edited by it .
The director of the division of international law was one of the two
principal legal advisers of the American Commission to Negotiate
Peace, the assistant director, Dr . Finch, was assistant legal adviser, as
were the chief division assistant, Henry G . Crocker, and Prof . Amos .
S . Hershey (who was added to the professional staff to aid in the work
for the State Department) ; and George D . Gregory accompanied the -
American group as secretarial-assistant translator .
The endowment also took part in the conference on the limitation of
armament and pacific relations in 1921-22, Elihu Root then president
of the endowment being one of the official United States delegates and
James Brown Scott, director of the division of international law, one
of the legal advisers .
Here again, the endowment offered the Secretary of State its co-
operation, which was accepted and a few weeks later Secretary of
State Hughes suggested that the endowment issue a series of pam-
phlets on the principal problems coming before the Conference .
President Root reporting to the board on April 21, 1922 said
I really do not know how the far-eastern work of the late Conference Upon
the Limitation of Armament could have been done without McMurray's book
which had just a few months before been published by the endowment . The
whole process of ranging the nine nations represented in the Conference upon
a basis of agreement for the treatment of Chinese questions so as to facilitate
the heroic efforts of the Chinese people to develop an effective and stable self-
government would have been exceedingly difficult, if not impossible, if we had not
had those two big volumes published by the endowment upon our tables for
access at any moment. We were continually referring to them and the members
could turn to such a page and find such a treaty and such an agreement and have
the real facts readily accessible .
When the Rockefeller Foundation turned to the social sciences and
the humanities as the means to advance the "well-being" of humanity,
the section entitled "Social Sciences" in the annual report was set up
under the following headings, which remained unchanged until 1935
General Social Science Projects : Cooperative Undertakings .
Research in Fundamental Disciplines .
Interracial and International Studies.
Current Social Studies .
Research in the Field of Public Administration .
Fundamental Research and Promotion of Certain Types of Organization.
Fellowships in the Social Sciences .
The report states that the arrangement was for the purpose of
"simplification and in order to emphasize the purpose for which ap-
propriations have been made ."
In the decade 1929--38 the foundation's grants to social-science
projects amounted to $31 .4 millions and grants were made to such
agencies as the Brookings Institution, the Social Science Research
Council, the National Research Council, the Foreign Policy Associa-
tion, the Council on Foreign Relations, and the Institute of Pacific
Relations in this country as well as a dozen or more in other countries,
and the Fiscal Committee of the League of Nations .
The original plunge of the foundation into the field of social science
was at the instigation of Beardsley Ruml, according to Raymond
Fosdick (The Story of the Rockefeller Foundation, p . 194), who in
1922 was appointed director of the Laura Spelman Rockefeller Me-
morial when consolidation of that organization with the foundation
was already being considered . During the 7 years, 1922-29 the me-
morial operated under Ruml's guidance it concentrated on the field of
social sciences and spent $41 million . Referring to the work of the
memorial Dr. Fosdick writes
He (Ruml) always insisted that his job was with social scientists, rather than
with social science. The sums which, under his leadership, were used to stimulate
64610--54--8
scientific investigation were perhaps not large in comparison with aggregate

expenditures for social sciences, but they represented a new margin of re-
sources, and they were employed dramatically at a strategic moment . Chan-
cellor Hutchins of the University of Chicago, speaking in 1929, summed up the
verdict in words which a longer perspective will probably not overrule : "The
Laura Spelman Rockefeller Memorial, in its brief but brilliant career, did more
than any other agency to promote the social sciences in the United States ."
Dr. Ruml was the head of the memorial for all but the first 4 years
of its existence.
Since the foundation absorbed the memorial's program and carries
on all its activities relating to government and international relations
under the heading of social sciences, these comments by Dr. Fosdick
and Dr . Hutchins have equal applicability to the work of the founda-
tion in these fields.
There is ample evidence from the foundation's yearbooks that it
carried on activities in the field of government of a political and
propaganda nature, as well as in the field of international relations,
and examples of this will be found in the "Exhibit-Rockefeller ."
Included in that exhibit also are the statement of Mr . Chester I .
Barnard in the Cox committee hearings, page 563, speaking of his
work as "the consultant of the State Department * * * on different
things from time to time," and quotations from Dr . Fosdick's book on
the foundation .
In 1935 the foundation's activities again were reorganized, and that
year the section "Social Sciences" begins : "In 1935 the foundation
program in the social sciences were reorganized along new lines with
emphasis upon certain definite fields of interest ."
Major changes were termination of financial aid to general institu-
tional research in the social sciences here and abroad, elimination of
grants for "the promotion of basic economic research," for community
organization and planning (unless within -the scope of one of the new
fields of interest), cultural anthropology, and schools of social work .
From then on the foundation was to concentrate on three areas of
study : Social security, international relations, and public adminis-
tration.
Subsequent statements made by the foundation concerning its work
in each of these fields will be discussed in the concluding portions of
this summary.
The same year that the foundation publicly announced that its
activities in the field of social science would be confined to interna-
tional relations and relations with government, the endowment was
engaged in a project related to both which exemplifies the methods
frequently used by the endowment in attempting to achieve world
peace . This project was the calling of an unofficial conference in
March of 1935 to consider possible steps to promote trade and reduc-
tion of unemployment, stabilization of national monetary systems, and
better organization of the family of nations to give security and
strengthen the foundations on which international peace must rest .
From this grew the reorganization of the National Peace Confer-
ence, composed of 32 newly organized city and State peace councils,
with its committees of experts appointed to supply factual data and
analyses of international affairs . Among the commissions were ones
on economics and peace, national defense, the world community, and
the Far East.


Of particular interest is the fact that the director of the League of
Nations Association, Clark M . Eichelberger, later to occupy the same
position with the Association for the United Nations, was placed in
charge of the endowment's educational program . Dr . Finch's com-
ment on this indicates the extensive nature of Dr . Eichelberger's
contacts through this assignment .
* * * He traveled extensively throughout the United States developing con-
tacts which resulted in the adoption of programs within numerous organizations,
some not hitherto reached by the endowment . Among them were : United States
Department of Agriculture Extension Service through its county and home-
demonstration agents and discussion specialists in the field ; extension services
of State agricultural colleges ; American Farm Bureau Federation and Asso-
ciated Women of the Federation ; National Farmers Educational and Cooperative
Union of America ; Junior Farmers Union ; 4-H Clubs ; National Grange ; in-
formal community forums and Federal forums sponsored by the United States
Bureau of Education ; classes and forums conducted by the Works Progress
Administration ; adult education ; workers' education and labor unions ; churches,
women's clubs, university groups, Rotary, and other service clubs . Leadership-
training conferences were established for the training of organizational repre-
sentatives from which the best qualified were selected for discussion leaders .
Literature was prepared by the division and supplied for use in discussion
programs. Basic pamphlet material of the Department of State was also used .
The radio played an important part. Local stations were supplied with electrical
transcriptions of addresses on world economic problems .
Dr. Finch has another comment as to the methods used in carrying
on this "educational program"
The educational program did not necessarily start with the subject of
international relations as such, but with topics which would help the member-
ship of these groups to recognize and analyze the economic, social, and educa-
tional problems within their own organizations and communities, and to under-
stand the factors, local, national, and international which create these problems ;
to discover to what extent each economic group could contribute toward the
solution of their common problems, and to what extent solutions of local prob-
lems were dependent upon national and international relations ; to know and
use the sources of information on public and international problems .
The National Peace Conference extended this "educational" work
in 1938 by undertaking "an educational campaign for world economic
cooperation," using Peaceful Change-Alternative to War, published
by the Foreign Policy Association, as the basic handbook . According
to Dr . Nicholas Murray Butler (1938 yearbook, p . 48) this campaign
was undertaken to emphasize the importance of putting into effect
the recommendations of the joint committee of the endowment and
the International Chamber of Commerce, and had two phases . The
first, from September 1937 to March 1938, was on education in the
fundamentals of world economic cooperation followed by a nation-
wide conference scheduled for March 1938 in Washington, D . C ., to
appraise the campaign up to that time, "to consider recommendations
of practical policy prepared by a committee of experts under the direc-
tion of Prof . Eugene Staley, and to formulate conclusions on specific
Government policies ." The second phase was another campaign of
education from March 1938 to January 1939 .
It is apparentt merely from reading the Rockefeller Foundation's
list of its "fields of interest" that in all probability it would frequently
contribute to the identical project and the identical organization, re-
ceiving contributions from the endowment . This is exactly what hap-
pened, and while in the amount of time available it is not possible
to itemize the projects, it is possible to select typical examples from
the agencies to which it contributed .
As a matter of fact, the endowment and the foundation concen-

trated their grants among the same agencies in practically every case.
Moreover, as it will become apparent,
parent, at times a joint activity (in the
sense that both contributed funds to a particular project or organ-
ization) was related to both Government and to international rela-
tions . Several of such organizations aided by both organizations will
be discussed separately because they are particularly pertinent to the
relations of the foundations to both Government and international
relations.
This was one of the first agencies to receive contributions from the
foundation when it enlarged its sphere of activity to include the
social sciences, and it has continued to make grants every year since
then .
The institution was authorized by the executive committee of the
endowment at Dr. Butler's instigation in 1919, as an integral part
of the Division of Intercourse and Education for the-
purpose of fostering and promoting closer international relations and under-
standing between the people of the United States and other countries, to act
as a clearinghouse of information and advice on such matters and to systematize
the exchange of visits of teachers and students between colleges and universities
of the United States and those of foreign countries .
It arranged itineraries and lecture tours for visiting professors and
circuited the visiting professors among the colleges and universities
of the United States, including visits to the International Relations
Clubs .
In Department of State publication 2137, page 9, entitled "The
Cultural Cooperation Program, 1938-43," there is the following state-
ment as to the place the institute came to occupy in international
education
The Institute of International Education in New York, a private organization,
began after the First World War to persuade universities in the United States
and in Europe to offer full scholarships (tuition, board, and lodging) for exchange
students . More than 100 universities in the United States and a similar number
in Europe cooperated . The institute reported that during the period 1920-38
approximately 2,500 foreign students were brought to the United States under
this plan, and 2,357 American students were placed in foreign universities .
The cash value of scholarships given by American universities to this group
of foreign students was $1,970,000, and the scholarships to American students
abroad were valued at $917,000 . This plan is especially significant because it
won support from so large a number of private institutions, each of which was
willing to : invest its own funds in the exchange of students .
The endowment also continued its contributions to this institute-
funds from both organizations amounting to approximately $5
million.
Foreign Policy Association
This organization received grants from the endowment, and, in
addition, many of its pamphlets were distributed to the International
Mind Alcoves and the International Relations Clubs .
In that connection, one of the persons whose books were distributed
by the endowment was Vera Micheles Dean, who is referred to later in
this summary . Mrs . Dean was given an international law scholarship
by the endowment in 1925-26 .
The Rockefeller Foundation between 1934 and 1945 (when it made a
tapering grant of $200,000) contributed $625,000 to the research, pub-
lication and educational activities of the Foreign Policy Association .
In 1950, when it terminated aid to the association, the foundation in its
annual report indicated that its reason for doing so was that it was
operating largely on a stable and self-supporting basis . However, in
1952 the Adult Education Fund of the Ford Foundation gave $335,-
000 to the association .
The Rockefeller Foundation in addition to contributing funds to the
Foreign Policy Association has referred to the Headline Series in its
annual reports, and, while not fulsome in praise, there is no doubt that
the foundation approved of them-the 1950 annual re ort (exhibit -
Rockefeller) refers to these books as the "popular Headline Books,"
with details on problems of importance to Americans and to the world .
Dr. Johnson, after describing the International Relations Clubs
(exhibit - Carnegie) adds that these clubs have now become associ-
ated with the Foreign Policy Association . In that connection, the
McCarran committee hearings contain frequent references to the inter-
locking association of that organization with the Institute of Pacific
Relations, and includes, among other exhibits, No . 1247, which dis-
cussed the Headline book, Russia at War, and refers to the good job
performed by the Foreign Policy Association of promoting Mrs .
Dean's pamphlet, through the regular channels .
Time has not permitted extensive inspection of the volumes pub-
lished by the Foreign Policy Association, but Vera Micheles Dean who
was the research director of the Foreign Policy Association and editor
of its research publications is referred to frequently in the McCarran
committee reports on the Institute of Pacific Relations . She is the au-
thor of Russia-Menace or Promise? one of the Headline Series, as
well as the United States and Russia (1948) .
While the Association refers to itself as a nonprofit American organ-
ization founded to carry on research and educational activities to aid
in the understanding and constructive development of American for-
eign policy which does not seek to promote any one point of view to-
ward international affairs, this statement is somewhat equivocal both
in view of the nature of its publications, and also because in those re-
viewed little attention was paid to the possibility of a nationalist
point of view as opposed to an internationalist one.
Another of the Headline Series, World of Great Powers, by Max
Lerner (1947), contains the following language
There are undoubtedly valuable elements in the capitalist economic organi-
zations . The economic techniques of the future are likely to be an amalgam of
the techniques of American business management with those of Government
ownership, control, and regulation . For the peoples of the world, whatever their
philosophies, are moving toward similar methods of making their economic
system work .
If democracy is to survive, it too must move toward socialism-a socialism
guarded by the political controls of a State that maintains the tradition of in-
tellectual consent and the freedom of political opposition . And the imperatives
of survival are stronger than the winds of capitalist doctrine .
This is an arduous road for democracy to travel, and it may not succeed . But
it is the only principle that can organize the restless energies of the world's
peoples .
Mr. Lerner's attitude insofar as Russia is concerned is indicated by

this language on pages 34 and 35, after stating that both Russia and
the United States merely want world peace and security
The successive layers of fear and suspicion on both sides can be stripped away
only when both show a creativeness in approaching each other halfway . This
would mean, for America, reopening the question of granting Russia a loan
or 6redits for the purchasing of machines and machine tools . These the Soviet
Union sorely needs for peacetime production and for lifting the terribly low
standards of living of the Russian people . For Russia it would mean a com-
mitment to return to the world economic and trade councils from which it with-
drew after Bretton Woods.
Moving from the economic to the political level, it would mean a willingness
on America's part to grant greater United Nations control of Japan and the
former Japanese island bases in the Pacific, and on Russia's part to be less
truculent about her sphere of influence in eastern Europe . Given such economic
and political agreements, a meeting of minds would become possible on the
international control of atomic energy, which is the central question both of
disarmament and peace .
One further illustration of the internationalist trend of the Foreign
Policy Association will be found in another Headline Series volume,
Freedom's Charter, The Universal Declaration of Human Rights, by
Dr. O . Frederick Nolde, which deals with the covenants on human
rights without referring to the criticisms made of their possible effects
on the Constitution and its Bill of Rights, and the entire tone of the
pamphlet is one of praise for the universal declaration . By a tech-
nique frequently found in pamphlets which are pro-United Nations
and its activities, Dr. Nolde obliquely places those who disagree with
the universal declaration-for whatever reason-in a category with
the Soviet Union who also object to certain phases, for example : "So-
viet emphasis on state sovereignty appeared in other contexts, also .
Many delegates contended that the universal protection of man's rights
will require a measurable yielding of national sovereignty . As previ-
ously pointed out, the U . S . S . R . took radical exception to this
contention ."
Up to the time this summary was written no book or pamphlet of
a contrary point of view (published by the association) has been
found-which raises the question of a comparison between the theory
expressed by the association not to seek to promote any one point of
view and of the type of books and pamphlets it sponsors and publishes .
Council on Foreign Relations
Here again the two organizations-the Carnegie Endowment for
International Peace and the Rockefeller Foundation-have been
substantial contributors to the work of an agency in the international
field . And again, as in the case of the Foreign Policy Association, it
is evident from the publications of the council that its approach is not
an unbiased one .
The Council has published studies by the following
Public Opinion and Foreign Policy-Lester Markel and others.
International Security-Philip: C . Jessup .
World Economy in Transition and Raw Materials in Peace and War-Eugene
Staley.
The Challenge to Isolation, 1937-40-William L . Langer and S . Y. Everett
Gleason.
Dr. Langer was later selected by the Council and the foundation to
prepare a history of American foreign policy from 1939 to 1946, which
has been stated to be a one-sided interpretation rather than an objec-
tive history of American foreign policy . No grants have since been
made (so far as can be ascertained from their records) by either the
Council or the foundation for preparation of a contrary evaluation
of this subject-and neither organization supported the volume by
Professor Tansill published a year or so ago, which gives the other side
of the picture.
It is interesting to note that shortly after World War II exploded
in September 1939, representatives of the Council visited the Depart-
ment of State to offer its assistance on the problems the conflict had
created and offered to undertake work in certain fields, without formal
assignment of responsibility on one side or restriction of independent
action on the other . A tentative outline was prepared for four groups
of experts to undertake research on : Security and Armaments Prob-
lems, Economic and Financial Problems, Political Problems, and Ter-
ritorial Problems. These came to be known as the War and Peace
Studies, and were financed by the Rockefeller Foundation under the
Council's committee on studies .
About February 1941, the informal character of the relationship
between the State Department and the Council ceased The Depart-
ment established a Division of Special Research composed of Eco-
nomic, Political, Territorial, and Security Sections, and engaged the
secretaries who had been serving with the Council groups to partici-
pate in the work of the new Division.
Following that, in 1942, a fifth group was added to the War and
Peace Studies, called the Peace Aims Group . This group had been
carrying on discussions regarding the claims of different European
nations, the relation of such claims to each other as well as to the cur-
rent foreign policy of the United States, and their relationship to
eventual postwar settlements 3 The State Department particularly
commended the work of this last group . That same year the rela-
tionship between the council and the Department became even more
close-the Department appointed Isaiah Bowman and James T . Shot-
well as members of its newly organized "Advisory Committee on
Postwar Foreign Policies ." In addition to their association with the
Council of Foreign Relations both had also been associated with
Carnegie organizations .
Particular interest attaches to this activity on the part of the coun-
cil . First of all, the action of the council in offering its services
closely parallels the action of the Carnegie endowment in both the
First and Second World Wars, and in view of Mr . Shotwell's back-
ground it seems likely that it was somewhat a case of taking a leaf
from the same book .
The second reason is because the research secretaries of the War
and Peace studies of the council progressed to other work related to
the organization of peace and the settlement of postwar problems
Philip E. Mosely, research secretary of the Territorial group, ac-
companied Secretary Hull to Moscow in 1943, when representatives
of Great Britain, the United States, the Soviet Union, and China
issued the Moscow Declaration, the text of which had been prepared
previously in the Committee on Postwar Foreign Policies . Mr .
Mosely later became political adviser to the American member of the :
I The endowment had conducted a similar study before world war I .
European Advisory Commission in London, and more recently has

been with the Russian Institute of Columbia University .
Walter R. Sharp, research secretary of the Political group, served
as Secretary General of the United Nations Food Conference at
Quebec in 1945 .
Grayson Kirk, research secretary of the Security group, was among
the experts at the Dumbarton Oaks Conference and was executive
officer of commission III at the San Francisco Conference .
Dwight E. Lee, research secretary of the Peace Aims group, was as-
sistant secretary of committee I, commission III at the San Francisco
Conference.
The outside experts also reappeared in other work
Dr. Isaiah Bowman was a member of the United States delegation
at the Dumbarton Oaks Conference, special adviser to the Secretary
of State, member of the Department's Policy Committee, and adviser
to the American delegation at the San Francisco Conference .
Hamilton Fish Armstrong served as adviser to the American Am-
bassador in London in 1944, with the personal rank of minister, also
as special adviser to the Secretary of State, and as adviser to the
American delegation at the San Francisco Conference.
Walter H. Mallory, secretary of the Steering Committee which
directed the War and Peace Studies, was a member of the Allied Mis-
sion to Observe the Elections in Greece, with the personal rank of
minister, a mission which grew out of the Yalta agreement to assist
liberated countries to achieve democratic regimes responsive to the
wishes of their people .
This does not include any of the several dozen members of these
council groups who were called into the Government in wartime
capacities not connected with formulation of postwar policies . Nor
is any implication intended that pressure was brought to secure
placement of any of these individuals in particular posts . It is self-
evident, however, that the research secretaries as well as the others
referred to later attained positions of influence in relation to the
foreign policy of the United States, and were instrumental in formu-
lation of the United Nations Organization .
During its operations the War and Peace Studies project held 362
meetings and prepared and sent to the State Department, close to
700 documents, which were distributed to all appropriate offcers, and
also reached other departments and agencies of the Government, since
representatives of many such agencies were informal members of
council groups . With a few exceptions these documents are now
in the council library and available for study .
The endowment also had direct association during this period
with the State Department, in addition to its association through
the work of the council just described, through its Division of Inter-
national Law. This association arose following Pearl Harbor in
1941, when the endowment offered and the Department accepted the
services of that Division, thus again establishing an informal basis
of cooperation .
At that time Philip Jessup, who was director of the division of inter-
national law from 1940 to 1943, resigned to devote his entire time to
Government service .
Following several exploratory conferences to determine what could
be learned from the experience of the League of Nations, the division
"established relations with many highly qualified and experienced
experts making it possible to plan and arrange for the preparation
of * * * series of studies on international organization and admin-
istration. * * *"
The first was 'International Law of the Future, Postulates, Prin-
ciples, and Proposals . It was followed by
International Tribunals, Past and Future
The International Secretariat : A Great Experiment in International Admin-
istration
Guide to the Practice of International Conferences
League of Nations and National Minorities
The Economic and Financial Organization of the League of Nations
Immunities and Privileges of International Officials
International Drug Control
Mandates, Dependencies, and Trusteeship
'The Customs Union Issue
The 1944 yearbook, pages 67-70 of the report of the director of the
division of international law, in a section devoted to the work program
of the division, refers to this statement of the International Law of the
Future, a second part containing "Principles," and a third p art con-
taining "Proposals," and in the extract from this yearbook complete
text is included in "Exhibit-Carnegie") there are these statements
* * * In line with the Moscow Declaration, the Postulates envisage a "general
international organization for the maintenance of international peace and
security ." The principles are offered as a draft of a declaration which might be
officially promulgated as the basis of the international law of the future . The
proposals for international organization are not offered as a draft of a treaty
but as suggestions for implementing the principles .
The following year, 1945, the yearbook has the following statement,
page 84 :
It is apparent from a reading of the proposals for the establishment of a
general international organization adopted at Dumbarton Oaks that their
drafting was influenced to some extent by the contents of the Statement of the
International Law of the Future which was published and given widespread
distribution on March 27, 1944.
(Moreover, while the endowment makes no reference to them, there
is great similarity also to the proposals for international cooperation
-drafted many years earlier, in which the endowment participated both
financially and through its personnel.)
According to Dr . Finch these documents were published "having
in mind" the objectives Mr . Churchill expressed in February 1945,
namely, that the former League of Nations would be replaced by a far
stronger body but which-
will embody much of the structure and the characteristics of its predecessor .
All the work that was done in the past, all the experience that has been gathered
by the working of the League of Nations, will not be cast away .
Dr . Finch's further comments (p . 435) are :
Advance copies of all but the last of the studies were made available to officials
of the United States and other governments in Washington . They were in
constant use at the conference of jurists held in Washington to revise the statute
of the International Court of Justice, at the United Nations Conference on
International Organization in San Francisco, the United Nations Relief and
Rehabilitation Administration Conference, the Interim Commission of the United
Nations Conference on Food and Agriculture, the United Nations Monetary and
Financial Conference and at the series of meetings held by the United Nations
in London, including the Preparatory Commission, the General Assembly, and
the Security Council, as well as the meeting of foreign ministers held in the
same city . The limited advance editions printed for these purposes were inade-
.8 88 TAX-EXEMPT FOUNDATIONS'
quate to meet the demand. The division also prepared special memoranda under
great pressure for use in connection with some of the foregoing conferences .
The portions of Dr . Finch's History quoted earlier on pages 9, 10
and 11, tell the story of former fellowship holders who have entered
various fields, including Government service, but there were others
who went from the endowment to places in public life
James T . Shotwell, who was director of the division of economics
and history for many years, was also chairman of the international
research committee of the American council, Institute of Pacific Re-
lations ; and while attending a conference of the institute in 1929 de-
livered a number of addresses on American foreign policy and prob-
lems in international organizations . In 1930 he became director of
research in international affairs of the social science research council,
and many of the publications in which his division took an interest
originated in research in Europe arranged for him by that organiza-
tion. Among these were :
International Organization in European Air Transport-Lawrence C . Tomb
Maritime Trade of Western United States-Elliott G . Mears
Turkey at the Straits-Dr . Shotwell and Francis Deak
Poland and Russia--Dr . Shotwell and Max M. Laserson
Dr. Shotwell was chairman of an unofficial national commission of
the United States to cooperate with the Committee of the League of
Nations on Intellectual Cooperation, and he later accepted member-
ship on the State Department's Advisory Committee on Cultural Re-
lations (1942-44) .
Dr. Finch, referring to the invitation extended to Dr . Shotwell to
serve on the Advisory Committee on Postwar Policy, goes on
* * * He was later appointed by the endowment its consultant to the Ameri-
can delegation to the United Nations Conference on International Organization
at San Francisco, April 25 to June 26, 1945 . These official duties placed Dr.
Shotwell in a position of advantage from which to formulate the changing pro-
gram and direct with the greatest effectiveness the operations of the commis-
sion to study the organization of peace .
The associate consultant was Dr . Finch himself, then director of
the division of international law.
Professor John B. Condliffe, associate director of the division of economics
and history (Berkeley branch office) edited a series of pamphlets dealing with
tariffs and agriculture . They covered, in addition to a general study of pro-
tection for farm products, cotton, dairy products, wheat, corn, the hog industry,
and sugar ; and were circulated to all county agricultural agents throughout
the country and were officially supplied by the Department of Agriculture to
every director of agricultural extension work in the United States .
Ben AI . Cherrington, who was elected trustee of the endowment in
1943, was the first Chief of the Division of Cultural Relations of the
State Department, serving until 1940 . Before that he was director
of the Social Science Research Council and professor of international
relations at the University of Denver.
Upon leaving the State Department he became chancellor of the
university where he remained until 1946, when he became a member of
the national committee of the United States for the United Nations
Scientific and Cultural Organization. Dr . Cherrington was an asso-
ciate consultant of, the United States delegation to the United Nations
Conference in San Francisco .
Philip C . Jessup was another endowment contribution to the field of
public service. His first assignment was in the Department of State,
as Assistant Solicitor in 1924-25, followed by his service as legal assist-

ant to Elihu Root, in 1929 at the Committee of Jurists on the Revision
of the Court Statutes, called by the League of Nations Council . Dr .
Jessup was assistant professor of international law at Columbia Uni-
versity and later became Mr . Root's biographer . He was elected a
trustee of the endowment in 1937, succeeded Dr. James Brown Scott
as director of the division of international law in 1940 and 1943
resigned because of the pressure of Government work during the war .
He was Assistant Secretary General of UNRRA and attached to
the Bretton Woods Conference in 1943-44 ; assistant on judicial or-
ganizations at the United Nations Conference in San Francisco, where
he helped to revise the statutes of the Permanent Court of Inter-
national Justice to the present form in the United Nations Charter .
He was also secretary of a national world court committee, organized
in New York, of which two trustees of the endowment were also
members .
The list of such individuals is long-and to include all the names
would merely lengthen this summary to no particular purpose .
Henry Wriston, Eugene Staley, Isaiah Bowman, John W . Davis,
Quincy Wright, John Foster Dulles, Robert A . Taft, and others-
either during their association with the endowment or at some other
time-also were in the public service .
United Nations
Both the Carnegie Endowment for International Peace and the
Rockefeller Foundation aided this cause . In the case of the endow-
ment it was a natural outgrowth of its deep interest in the League of
Nations and the World Court, and its disappointment when the United
States failed to join the League, intensified its activities in connection
with the United Nations .
The close association between the endowment and the State Depart-
ment, even before World War II actually enveloped this country, has
been discussed, and it is apparent that the idea of achieving peace
through a world government arrangement was still the goal of the
endowment as indicated by the character of its representatives and
the nature of their activities .
While Dr . Jessup was director of the division of international law,
it undertook an investigation of the numerous inter-American sub-
sidiary congresses and commissions which are part of the pan-Ameri-
can system and as a result amassed a considerable amount of incidental
and extraneous information of a technical and administrative char-
acter concerning the composition and functioning of permanent inter-
national bureaus and commissions . In collaboration with the public
administration committee of the Social Science Research Council, Dr .
Jessup began a study of this subject and the project later broadened
to include not only official administrations and agencies established
by American governments, but private international organizations
operating in specialized fields, special emphasis being given to the
structural and administrative aspects of these organizations .
The work covered approximately 114 organizations, supplied the
names and addresses of each organization along with a brief account
of its history, purpose, internal administrative structure, membership,
finance, publications, and activities, and was intended primarily to
serve government officials and officers of international administration,

students, teachers, and finally the public .
At this point it is appropriate to say something about the Commis-
sion To Study the Organization of the Peace, which while not a part of
the endowment's direct program was treated as work through another
agency to which the endowment was willing to grant financial support.
The policy .of the endowment in such instances is discussed in the
concluding portion of this summary .
The commission in actuality was merely a continuation of the
National Peace Conference referred to on pages 880 and 881 .' It came
into being under that name in 1939, under the aegis of Dr . Shotwell
and Clark M . Eichelberger-guiding lights of the peace conference-
and immediately began organization of regional commissions and
monthly discussion meetings .
It too had an "educational program," carried to rural communities,
and furnished to press services, editors, educational writers, column-
ists, and commentators .
On June 6, 1941, the commission issued a document entitled "State-
ment of American Proposals for a New World Order."
In February 1942, this was augmented by "The Transitional Period ."
A year later, 1943, the commission followed these with a statement
dealing with steps that should be taken during the war to organize
for the transition period .
Between then and 1944 these were added
General Statement and Fundamentals
Part I-Security and World Organization
Part II-The Economic Organization of Welfare
Part III-The International Safeguard of Human Rights
A recapitulation of the principles laid down was issued after Dum-
barton Oaks, entitled : "The General International Organization-
Its .Framework and Functions ."
According to Dr . Finch (p . 248)
During the following Dumbarton Oaks Conference the commission kept the
work of the conference before the public and organized an educational program
in behalf of its proposals . It also directed its studies to subjects inadequately
covered by or omitted from the proposals, such as human rights, trusteeship,
and economic and social cooperation . Separate committees were set up on each
of these subjects and their studies and conclusions were later published .
At the San Francisco Conference the commission was able to promote its objec-
tives through many of its officers and members who were connected with the
Conference in an official or consultant capacity . Following the signature and
ratification of the charter and the establishment of the United Nations, the Com-
mission To Study the Organization of Peace planned its studies and educational
program with two purposes in view : Making the United Nations more effective
by implementation and interpretation, and making it the foundation of the foreign
policy of the United States .
The commission became the research affiliate for the American Association for
the United Nations, with joint offices and interlockingg officers in New York . It
is estimated by Dr . Shotwell in his annual report of March 27, 1945, to the endow-
ment that over 600,000 copies of the commission's reports had been distributed
and distribution of over 31/4 million pieces of its popular material numbers.
In "Exhibit-Carnegie" statements taken from the endowment's
yearbooks trace the steps taken by the endowment to advance the cause
of the United Nations . The 1944 volume tells of the conferences
attended by former officials of the League of Nations, as well as by
government officials, and says the third "will be of interest to a much
wider group, including not only officials but educators and others
deeply concerned with the need of adequate training for the staffs of
many international agencies which are either in process of formation
or are contemplated for the postwar period ." The first of these con-
ferences was held in August 1942-less than 9 months after Pearl
Harbor-and the last was held in August 1943-2 years before the
San Francisco Conference .
That same yearbook describes the activities of the endowment as
having placed it "* * * in a peculiarly strategic position to cooperate
with official agencies preparing to undertake international functions"
and states that while the Office of Foreign Relief and Rehabilitation
Operations was engaged in preparing for the organizing conference
of UNRRA it "* * * frequently called upon the division to assist by
various means in these preparations ."
The endowment supplied special memoranda to the conference, as
well as copies of its various publications relating to international
organization and administration. The special memoranda covered
such subjects as International Conferences and Their Technique,
Precedents for Relations Between International Organizations and
Nonmember States, and the like .
The following year, 1945, the work of the Commission To Study the
Organization of the Peace was again referred to (pp. 112-114) and a
quotation concerning it has been included in "Exhibit-Carnegie ."
The endowment had two other projects which fall into the inter-
national field-the International Economic Handbook and Commer-
cial and Tariff History and Research in International Economics by
Federal Agencies . The latter disclosed the extent to which the
Government of the United States engaged in the study of economic
questions and the resources of economic information at its disposal.
It also cooperated with the International Chamber of Commerce
and Thomas J. Watson, a trustee of the endowment, was chairman of
a committee established in 1939 by the chamber called a committee for
international economic reconstruction . Dr. Finch described one of
the first projects of the comrn .ittee (p. 243) as "a program of public
adult education in this country ." Later the committee was renamed
the committee on international economic policy and set about enlisting
54 leaders of national, business, industrial, education, and religious
groups. These included Mr . Winthrop W. Aldrich, President Nich-
olas Murray Butler, Mr. Thomas J. Watson, Mr . Leon Fraser, Mr .
Clark H . Minor, Mr. Robert L. Gulick, Jr ., Eric A . Johnston, Robert
M. Gaylord, Paul G. Hoffman, Eliot Wadsworth, A . L. M. Wiggins,
J. Clifford Folger, E . P . Thomas, and Fred I . Kent.
According to the yearbook, a public-relations committee was organ-
ized and . professional news services were employed to reach American
grassroots, in order to secure the widest possible distribution of the
pamphlets produced by the committee, among which were
World Trade and Employment, by the advisory committee on economics to the
committee on international economic policy .
The International Economic Outlook, by J . B. Condliffe, associate director, divi-
sion of economics and history, Carnegie Endowment for International Peace .
Industrial Property in Europe,- by Antonin Basch, department of economics,
Columbia University .
Price Control in the Postwar Period, by Norman S. Buchanan, professor of
economics, University of California.
Economic Relations With the U . S. S. R., by Alexander Gerschenkron, Inter-
national Section, Board of Governors of the Federal Reserve System .
A Commercial Policy for the United Nations, by Percy W . Bidwell, director of

studies, Council on Foreign Relations .
International Double Taxation, by Paul Deperon, secretary of the Fiscal Com-
mittee, League of Nations .
Discriminations and Preferences in International Trade, by Howard P . Whidden,.
economist, Chamber of Commerce of the State of New York .
Principles of Exchange Stabilization, by J . B . Condliffe .
International Commodity Agreements, by Joseph S. Davis, director of the food
research institute, Stanford University .
Import Capacity of the United States, by J. B. Condliffe and R . L. Gulick.
World Production and Consumption of Food, by Karl Brandt, Stanford
University .
International Cartels, by A. Basch .
Export Policy, by Robert L. Gulick, economist, Carnegie Endowment for Inter-
national Peace .
The Relation Between International Commercial Policy and High Level Em-
ployment, by Sumner H . Slichter, Harvard University .
Thousands of copies of the committee's pamphlets on international
economic problems were distributed to business executives, agricultural
leaders, diplomatic representatives, students, Government officials,
servicemen, Members of Congress, and to congressional committees .
A special project in this field was the work done at the time the recip-
rocal trade-agreements program came before Congress for renewal,
when special literature in support of the program was prepared and
distributed by the endowment .
The Rockefeller Foundation was working shoulder to shoulder with
the Carnegie Endowment for International Peace in furthering
"agencies devoted to studies, to teaching, to service to government and
to public and expert education" on the assumption that while "it is
not possible to guaranty peace * * * the way to work toward it is
to strengthen the ìnfinity of threads that bind peace together ."' It
selected many of the same agencies which had been chosen by the
endowment for studies and related activities . In the international-
relations field grants went to agencies which conduct research and
education designed to strengthen the foundations for a more enlight-
ened public opinion and more consistent public policies (1946 annual
report) .
This same foundation report (p . 40) mentions the appropriation to
the Institute of Pacific Relations of $233,000, much of whose work "is
related to the training of personnel, the stimulation of language study,
and the conduct of research on problems of the Far East . It is part
of the pattern by which, from many different directions and points of
view, efforts are being made to bring the West and East into closer
understanding ."
Two years earlier, the 1944 report of the foundation said "China
is the oldest interest of the Rockefeller Foundation," and it has spent
more money in that country than in any other country except the
United States . In addition to direct grants to China and Chinese pro-
jects of various sorts, the foundation also contributed to the Institute
of Pacific Relations, including the American institute .
In that connection, it is interesting to note that 7 years before (1937
report, pp. 57-58) the foundation deplored the events of the previous
year in China which "have virtually destroyed this proud ambition,
in which the foundation was participating ." The report praised the
work accomplished up to that time by the Chinese National Govern-
ment in their attempts "to make over a medieval society in terms of
modern knowledge" but was somewhat pessimistic as to the oppor-
tunity "to pick up the pieces of this broken program at some later
date . '
From 1937' until 1950 the grants of the foundation to the Institute
of Pacific Relations were $945,000, compared with $793,800 during-
the years prior to that (from 1929 to 1936, inclusive) .
The Institute of Pacific Relations has been the subject of exhaus-
tive hearings by other congressional committees, and mention is made-
of this particular comment only because as recently as 1952 (if finan-
cial contributions are one criterion) the foundation apparently con-
sidered the institute an agency "designed to strengthen the foundations
for a more enlightened public opinion and more consistent public
policies ."
A section entitled "Conference on American Foreign Policy" in
the 1916 endowment yearbook (pp . 24-25) begins : "To assist in in-
forming public opinion concerning the foreign policy of the United :
States, the endowment sponsored a conference at Washington * * *."'
Some 80 national organizations sent 125 representatives to hear from
James F . Byrnes, then Secretary of State ; Clair Wilcox, Director of
the Office of International Trade Policy ; Gov. Herbert Lehman ; Dean
Acheson, Under Secretary of State ; Alger Hiss, Secretary General of
the United Nations Conference at San Francisco ; and William Benton,,
Assistant Secretary of State in Charge of Public Affairs .
From then on the endowment bent every effort to "reach public-
opinion" and particularly people not reached by any organization
"since they have not been interested to join, and who do not realize
that they too constitute public opinion and have to assume their re-
sponsibilities as citizens not only of the United States but of the
world ." This phraseology is strikingly similar to that found in the
Handbook on International Understanding of the National Education :
Association.
It does not appear whether the foundation contributed to the Com-
mission to Study the Organization of the Peace but the annual re-
ports refer to studies carried on by Brookings institution, the Rus-
sian institute of Columbia University's School of International Affairs, .
the Institute of International Studies at Yale, all "aimed at the single •
target of world peace" (Dr. Fosdick's Story of the Rockefeller Foun--
dation, p. 219) .
In 1945 it aided in the publication of the reports and discussions :
of the various committees of the San Francisco United Nations Con-
ference because "with respect to many crucial issues the really signifi--
cant material is not the formal language of the articles of the' charter,,
but the interpretation contained in the reports and discussions * * *."-
It also contributed to the United Nations Economic Commission for-
Europe which in 1949 began a study of long-run trends in European
economy, covering the period 1913-50 (1951 annual report, pp . .
355-356) .
This, the final part of the summary of activities of Carnegie and
Rockefeller agencies, has been devoted to substantiating the state-
ments made in its opening paragraphs ; namely, that the Carnegie-
Endowment for International Peace and the Rockefeller Founda-
tion had-
Admittedly engaged in activities which would "directly or-
indirectly" affect legislation ;

Admittedly engaged in "propaganda" in the sense defined by

Mr. Dodd in his preliminary report ;
Admittedly engaged in activities designed to "form public
opinion" and "supply information" to the United States Govern-
ment, calculated to achieve a certain objective, as for example,
"an international viewpoint ."
Quotations on each of these points, taken from the yearbooks of the
Carnegie Endowment for International Peace and from the annual
reports of the Rockefeller Foundation, as well as from other sources,
have been referred to and are attached in separate exhibits .
Because of the method of reporting used by the endowment, it is
frequently difficult to distinguish specific projects and organizations
in its financial statements-disbursements in most instances being
reported merely by divisions . In addition, the corporation worked
closely with the endowment on certain types of projects, and also
made lump-sum grants to the endowment .
An analysis of grants by these two Carnegie agencies and by the
Rockefeller Foundation is shown below .
Because it is frequently stated by these foundations as well as
others that the purpose of their grants is to serve as a catalytic force
in getting a project underway, or provide support to an organization
until it is well established, the period during which the foundation
contributed funds to a particular organization is shown under the
grants made.
Carnegie Rockefeller
Grantee organization Total con-
Endow- Founda- Spelman tribution
Corporation
ment tion fund
($169,000 General
Education Board)
American Council of Learned Societies
(1924) . $901,850 $11,500 $11,069,770 ( $30,000 $12,182,120
(1924-52) (1940-44) (1925-52)
American Historical Association (1884)__ 384,000 _________ _ 190,0 55,000 629,830
(1926-35) (1925-3 ;)
Brookings Institution (1916) 2,493,624 4,000 1,848,500 1 3,211,250 7,557,374
(1922 (1
Council on Foreign Relations (1021) 1,826 5824 (1951250000 1,170, 00 52) 150,000 3,159,524
Foreign Policy Association (1918) (19204000 (1931 0)00 900,000 1 3,189,524
(1938-51) (1934-40) (1933-50)
(1919) 2,073,013 200,000 1,406,405 I 240,000 3,847,148
(1922-52) (1941) (1928-52) 11,407,320
Institute of Pacific Relations (1925) 390,000 184,000 1,885,400 1 165,000 2,449,400
(1936-47) (1927-41) (1925-50)
National Academies of Science 5,406,500 ------------- 110 ,0
00 5,516,500
National Research Council (1916) 3,059,180 __-______-___ 11, 555, 500 I 447, 900 15, 062, 580
(1920-52) (1922-52)
National Bureau of Economic Research
(1920) 848,503 -------------- 6,647,500 I 125,000 7,621,003
(1924-52) (1931-52)
New School for Social Research (1919)--_ 95.000 ------------- 208,100 1 300,100
(1940) (1940-44)
Public Administration Clearing House
(1931) 58,182 ------------- 10, 740 I 8,058.000 8,126,922
(1931-52) (1931-52)
Royal Institute of International Affairs__ 244,100 ------------- 906,580 1 1,150, 680
(1938-51) (1938-52)
Social Science Research Council 2,014,275 ------------- 8,470,250 4,044,000 14,528,525
Encyclopedia of Social Science 20,124 ------------- 600,000 100,000 969,124
1 International relations clubs, regional centers, etc .


The projects for which these grants were made-in addition to those
made for general support-covered such projects as :
A Handbook for Latin American Studies
Developing'a training center for far eastern studies at the Congressional Library
(both by the American Council of Learned Societies)
Study of major aspects of Government finance for defense (by the National
Bureau of Economic Research)
Study of problems relating to training of leaders among free peoples (by the
Council on Foreign Relations)
Research on American foreign policy
Foreign relations
Political implications of the economic development of industrialized areas (all
by the Council on Foreign Relations)
Support of experimental educational program, publicizing the conflicting issues
of economic nationalism and internationalism .
Program for development of community centers of international education
(Foreign Policy Association
Another statement frequently made by foundations, including both
the endowment and the foundation-particularly when the actions
of benefiting organizations or individuals arouse criticism-is that as
a matter of policy no attempt is or should be made to supervise, direct
or control organizations or individuals to whome these tax-exempt
funds are given, because to do so would restrict the productivity of the
grantees, and (it is inferred) be an attack on academic freedom . This
attitude of objectivity, however, is at variance with other statements
also found in the records of both the endowment and foundation .
In describing the administration of his division (Intercourse and
Education) Dr . Butler's report in the 1928 year book (p . 38) states
that, in addition to other work-
a large part of the activity of the division is devoted to the carrying out of
specific, definite, and well-considered projects of demonstrated timeliness * * *
those in which the work is directed and supervised from the headquarters of the
division and those which are carried out by the organizations or individuals to
whom allotments are made from time to time . * * * It is not the policy of the
division to grant subventions continuing from year to year to organizations or
undertakings not directly responsible to the administration of the division it-
self. * * * [ Italics supplied.]
This statement-included in its entirety in the exhibit of quotations
from endowment records-is susceptible to only one interpretation
Unless a project, whether carried on by a particular organization or
by a particular individual or group of individuals is under the direct
supervision of the Division of Intercourse and Education, and reports
thereon are satisfactory to that division, continued support will not be
forthcoming from the endowment .
As mentioned earlier, the foundation does not use quite as dogmatic
language in its reports, yet from its statements the same contradictory
attitude is discerned, particularly when related to the activities and
organizations to which it has continuously granted funds .
There is nothing ambiguous about the warning on page 9 of the
1941 annual report of the foundation
If we are to have a durable peace after the war, if out of the wreckage of the
present a new kind of cooperative life is to be built on a global scale, the part
that science and advancing knowledge will play must not be overlooked .
This statement appears in the report for the 12-month period end-
ing December 31, 1941-not quite 4 weeks after Pearl Harbor-yet
there can be no doubt that, as far as the foundation was concerned,
only "a cooperative life * * * on a global scale" could insure a
"durable peace."
In the light of this attitude some of the individuals and organiza-
tions benefiting from foundation funds in the years since 1941 may
seem a trifle unusual to say the least, particularly when a few pages
further on, page 12, the report follows up this warning with
A score of inviting areas for this kind of cooperation deserve exploration .
Means must be found by which the boundless abundance of the world can be
translated into a more equitable standard of living . Minimum standards of
food, clothing, and shelter should be established . The new science of nutrition,
slowly coming to maturity, should be expanded on a worldwide scale .
It is only natural to wonder about the agencies selected to work in
these inviting areas to build "a cooperative life on a global scale ."
Among those to which the foundation gave funds were agencies also
selected by the endowment to be directly responsible to the administra-
tion of its divisions,and some of these are sketched briefly now in rela-
tion to these declared policies.
The Public Administration Clearinghouse, the creation and financ-
ing of which Dr. Fosdick (page 206) calls "the great contribution of
the Spelman Fund," is also a grantee of the foundation .
Composed of 21 organizations of public officials representing func-
tional operations of Government (such as welfare, finance, public
works, and personnel) the clearinghouse is designed to keep public
officials in touch with "the results of administrative experience and
research in their respective fields" which he describes as having re-
sulted in "wide consequences" which "have influenced the upgrading
of Government services at many technical points-in the improve-
ment of budgetary and personnel systems, for example, and the reform
of State and local tax structures."
The National Bureau of Economic Research, again quoting from
Dr . Fosdick's book, page 233, has brought within reach-
* * * basic, articulated, quantitative information concerning the entire econ-
omy of the Nation. This information has influenced public policy at a dozen
points. It was one of the chief tools in planning our war production programs
in the Second World War and in determining what weights our economy could
sustain . It underlies our analyses of Federal budgeting and tax proposals and
projects like the Marshall plan . This same type of research has now spread
to other countries, so that international comparison of the total net product
and distribution of the economy of individual nations is increasingly possible .
After stating with some pride that the books and other publications
of this organization "influence to an increasing degree the policies
and decisions of governmental and business bodies"-page 213-Dr .
Fosdick in the following chapter-page 232 stresses that its-
* * * publications do not gather dust on library shelves . Its findings are
cited in scientific and professional journals, treatises, and' official documents .
They are used by businessmen, legislators, labor specialists, and academic econ-
omists. They have been mentioned in Supreme Court decisions . They are
constantly employed in Government agencies like the Department of Commerce
and the Bureau of the Census . Increasing use is being made of them by prac-
ticing economists in business, by editorial writers in the daily press, and by
economic journalists in this country and abroad . Practically all of the current
textbooks in either general economics or dealing with specific economic problems
draw a great deal of their material from the publications of the Bureau or from
data available in its files . It can be truly said that without the National Bureau
our society would not be nearly so well equipped as it is for dealing with the
leading economic issues of our times .
The Institute of, Pacific Relations has been the subject of exhaustive
hearings by other congressional committees in which its subversive
character has been thoroughly demonstrated.
The Foreign Policy Association has been discussed at length in
the narrative portions of this report and reference has been made to
Mrs. Vera Micheles Dean's citation in appendix IX . Also active in
this association have been : Roscoe Pound, Stephen P . Duggan, Max-
well Stewart and his wife, Marguarite Ann Stewart (educational
secretary in the association's department of popular education),
Lawrence K . Rosinger, writer for the headline series, Stuart Chase,
Alexander W . Allport (membership secretary of the association) ;
Anna Lord Strauss. Philip E . Mosely, and Brooks Emeny (members
of the editorial advisory committee), and Blaire Bolles and Delia
Goetz, director and assistant director of the Washington bureau of
the association .
The Council on Forel Relations has also been discussed in detail,
and while additional in ormation could be included on specific activi-
ties it would be merely cumulative .
Two brief excerpts from the 1936 annual report of the foundation
;are, however, of particular pertinence in relation to the question of
- influencing governmental activity
The program in social security has two central interests : (1) The improve-
ment of the statistical record of structural and cyclical change and sharper
identification of the causal factors involved ; and (2) the analysis and adapta-
tion of social measures designed to mitigate individual suffering due to unem-
ployment which may be a result of economic change, or due to illness, accident,
and old age, which are ordinary hazards of human life . The underlying assump-
tion of this twofold program 4 is that economic and social changes are to an
appreciable extent manmade and hence controllable, and that, pending adequate
understanding of the causes of disruptive change, the individual must be pro-
tected in the interest of political and social stability . * * * The ameliorative
aspect of the program is at present concerned with questions centering upon
the social insurances and relief in the United States .
The program in public administration is designed to bridge the gap that exists
between practical administrators in the Government service and scholars in the
universities in the field of the social sciences . Aid had been given to the Social
Science Research Council's committee on public administration, which itself
-sponsors research upon key problems of public administration, * * * The foun-
dation supports a number of such research enterprises together with a variety
-of projects designed to recruit and train a higher type of personnel for career
service in the Government .
The objectives of the program in international relations are the promotion of
understanding of, and greater intelligence in regard to, world problems among
larger sections of the public, and the creation of more competent technical staffs
:attached to official or nonofficial organizations dealing with international affairs .
The greater part of foundation interest is in enterprises concerned with the
study of international problems for the purpose of informing and guiding public
opinion . Three types of organizations are receiving foundation support : (1)
Those like Chatham Hpuse in England and the Foreign Policy Association in the
United States, which carry on the two functions of study and dissemination
with almost equal emphasis ; (2) those concerned primarily with research and
-the creation of personnel for technical and advisory service in connection with
international problems ; and, (3) those which focus upon coordinated research
undertakings and periodic conferences with international representation, as the
Institute of Pacific Relations and the International Studies Conference . (Pp .
230, 231, 232.)
6 The foundation's twofold program in social security .
The Social Science Research Council, which sponsored the 4-volume

Study of the American Soldier, as well as a project entitled "Study
of American Public Library ." This actually deals with the public
library inquiry, a project relating to educational films and their dis-
tribution that has been received with considerable criticism .
Moreover, the council's committee on government (through a spe-
cial committee on civil rights) was selected to "encourage and aid
competent scholars to record and analyze the management of civil
liberties during the war and immediate postwar period" (Foundation
Annual Report for 1944, p. 202) . Prof. Robert E . Cushman of Cornell
was chairman of the special committee, and in the 1948 annual report
his assignment is referred to as a "factual examination of the civil-
liberties issues" caused by "the actions taken to eliminate subversive
individuals from GoN ernment service." "Rigid loyalty requirements"
and "the work of the House Committee on Un-American Activities"
are among the problems to be studied "to reconcile, if possible, the
claims of national security and civil liberty ." Practically the first
official act of Dr . Cushman as chairman was to place Dr . Walter Gell-
horn in charge of the project for all practical purposes .
Based on their own records the Carnegie Corporation, the Carnegie
Endowment for International Peace, and the Rockefeller Foundation,
have-
1. Contributed substantial sums of money to some or all of the
organizations described in this and other portions of this
summary .
2. Have or should have been aware that the stated purpose of
many of the projects of these organizations has been to achieve
certain objectives in the fields of international relations, foreign
policy, and government.
There has been a singular lack of objectivity and a decided
bias toward a socialized welfare state in the proposals of these
organizations, and every effort has been made by them to advance
the philosophy of "one world" to the complete disregard of com-
parable effort on behalf of a more nationalistic viewpoint .
3. Not only made grants to these organizations for general sup-
port, but have made specific grants for projects described in the
preceding numbered paragraph .
The foundation has contributed $63,415,478 since 1929 to projects
which it classifies as in the field of social science, while grants it con-
siders as in the field of the humanities total $33,292,842 during the
same period .5
The endowment, since it was organized, has expended approxi-
mately $20 million, divided as follows : Division of intercourse and
education, $12.1 million ; division of international law, $4.8 million ;
division of economics and history, $3.1 million .
Certainly, in justice to the endowment and the foundation it would
be unfair to say that the amount of money so expended by them during
the period described did not have some effect-at some point-on
some matters . To accept the statement that there were no effects-or
only coincidental ones-from such expenditures would indicate mental
astigmatism at the very least, and would in a sense seem to accuse
these foundations and their trustees of a somewhat careless, if not
actually wasteful, attitude toward the funds entrusted to their care,
5 Through 1952.


when (as is undeniable) the foundations continued to select the same
or similar organizations, continued to make grants for the same or
similar projects presented by such organizations, and continued to
make grants to the same or similar individuals .
In addition, the reports of both the endowment and the foundation
contain statements indicating both felt there were definite results
from their activities as well as the activities of organizations to whom
grants were made .
The 1934 yearbook of the endowment has one of these on page 22 :
* * * A review of the activities of the endowment since the World War,
carried on separately through three main divisions, but operating as a unit in
behalf of the great ideal of its founder, seems to justify the observation that the
endowment is becoming an unofficial instrument of international policy, taking
up here and there the ends and threads of international problems and questions
which the Governments find it difficult to handle, and through private initiative
reaching conclusions which are not of a formal nature but which unofficially
find their way into the policies of governments.
Similar sentiments are expressed a decade later in the 1945 year-
book, page 28 :
A reading of this report will make it plain that every part of the United States
and every element of its population have been reached by the endowment's work .
The result may be seen in the recorded attitude of public opinion which makes
it certain that the American Government will be strongly supported in the
accomplishment of its effort to offer guidance and commanding influence to the
establishment of a world organization for protection of international peace and
preservation of resultant prosperity .
The foundation, when it reorganized in 1929 to extend its work to
include the social sciences, apparently anticipated some recognizable
results (p . 258 of its annual report)
From research in the social sciences there should result modifications in gov-
ernmental organization, in business practices, in social activities of all kinds
which may further general well-being. As numerous functions of great signifi-
cance are being assumed by governmental bodies through Federal, State, county,
and municipal organization, the development of effective techniques becomes a
necessity. Research which is closely tied up with practical activities is expected
to furnish the basis of sound governmental policy .
There is no indication of a change of opinion in 1940, when describ-
ing its support of the National Institute of Public Affairs' "experi-
mental program of recruiting and training personnel for the Federal
services," the foundation reports (pp . 273-274 of annual report) ,6 "the
program has involved the annual placement of approximately 50 grad-
uate students preparing for public-service careers, in agencies of the
Federal Government for a year of practical apprenticeship" and adds
with evident satisfaction that "60 percent of its ìnterns' are now in
the Federal service ; several are in State and local or other government
services, and a number are continuing graduate study ."
Two years later the section dealing with the public administration
committee begins
The agencies through which society will seek to meet its diverse problems are
multiform, and total effort, whether for defense or for the postwar world, will
receive its primary direction through the agency of government * * * .
Referring to its support of this committee during the preceding 7
years, the report gives the major studies of the committee, and ends
with this paragraph : 7
n Entire extract included in exhibit .
* Entire extract included in exhibit .

More recently the committee has focused its resources and attention mainly
on planning and stimulating rather than on executing research . A broadening
of the program to include the field of government, with public administration as
one sector, is now contemplated . Such a program would deal less with the
mechanics of administration than with the development . of sound bases for
policy determination and more effective relations in the expanding governmental
structure.
It is only commonsense, moreover, to conclude that, since the endow-
ment and the foundation as a means of accomplishing their purposes
had deliberately chosen certain organizations consistently as "agents,"
the trustees of those foundations would be entirely aware of the activ-
ities of the organizations selected, as well as the views expressed by
their executives. Assuming such awareness-no contrary attitude
being demonstrated-it could be concluded further that the results of
such activities-whatever their nature-were not only acceptable in
themselvesto the trustees but were regarded by them as the proper
means to accomplish the declared purposes of the foundations .
IL,is appropriate, therefore, to examine some of the results, among
which have been
The Headline Books o f the Foreign Policy Association
Many were written b y persons cited to be of Communist or Commu-
nist front affiliation and are questionable in content . They have been
distributed widely and are used as reference works throughout the
educational system of this country .
The Cornell studies
This project is under the direction of two individuals (described
further on) who can scarcely be considered sufficiently impartial to
insure a "factual examination" or an "objective finding ."
Development o f a "post-war policy"
The means selected was an extragovernmental committee, many of
whose members later held posts in governmental agencies concerned
with economic and other problems, as well as those concerned with
foreign policy .
The sponsorship of individuals who by their writings are of a
Socialist, if not Communist philosophy, dedicated to the idea of world
government .
Among the individuals sponsored have been
Eugene Stale y
He is the author of War and the Private Investor, in which he recom-
mended a "World Investment Commission" which along other sugges-
tions presented bears a striking resemblance to the World Bank and
present monetary policies of the world, including the United States .
He is also the author of World Economy in Transition, a report pre-
pared under the auspices of the American Co-Ordinating Committee
for International Studies," under the sponsorship of the Council on
Foreign Relations, and financed by a Carnegie grant . The book ex-
pounds the theory that modern technology requires its materials from
an international market, makes use of internationally discovered scien-
tific information, and itself is international in viewpoint . According
to Mr. Staley, we have a "planetary economy," and to reach the goal
8 Mrs. Dean was a member of this committee at the time .
of international social welfare, the international division of labor re-
quires a free flow of goods .
Vera Micheles Dean
Reference has already been made to Mrs . Dean who, according to
the New York Times a few years ago, made a "plea for socialism" to
600 alumnae at Vassar College, saying our quarrel with communism
must not be over its ends but over its methods ; and urging a foreign
policy backing Socialist programs.
Speaking of her book Europe and the U . S . in the book review
section of the New York Herald Tribune of May 7,1950, Harry Baehr,
an editorial writer for that paper, wrote : "In other words, she con-
siders it possible that the world may not be divided on sharp ideo-
logical lines but that there may yet be at least economic exchanges
which will temper the world struggle and by reducing the disparity in
standards of living between Eastern and Western Europe gradually
abolish the conditions which foster communism and maintain it as
a dangerous inhumane tyranny in those nations which now profess
the Stalinist creed ."
Mr. and Mrs. Maxwell Stewart (Marguerite Ann Stewart)
According to the 1947 California Report (p . 314) both of these
people taught at the Moscow Institute in Russia . He praised "Soviet
marriage and morals," and has been connected with tourist parties
to the U . S . S . R., under Soviet auspices . He urged recognition of
the Soviet Union, was a member of the editorial board of Soviet Russia
Today, and endorsed the Hitler-Stalin pact.
Lawrence K . Rosinger
He declined to answer when asked by the McCarran committee
whether he had ever been a member of the Communist Party, after
being named as a party member by a witness before that committee .
He was a writer of the Headline Series of the Foreign Policy Asso-
ciation, among his contributions being "Forging a New China," "The
Occupation of Japan," and "The Philippines-Problems of Inde-
pendence." In February 1952-after he had refused to answer the
question of the McCarran committee-he jointed the staff of the
Rhodes School.
Dr. Robert Cushman
Chairman of the special committee on civil rights of the Social
Science Research Council's committee on government, Dr . Cushman's
career before his association with the Cornell studies would indicate
a rather one-sided viewpoint on civil rights . Prior to 1944, when the
first Rockefeller Foundation grant was made to this project, Dr . Cush-
man had written occasional pamphlets (edited by Maxwell S . Stew-
art) for the public affairs committee, for example-
One written in 1936 suggested constitutional amendments to
limit the powers of the Supreme Court (following its adverse
decision on the New York minimum wage law), or else a dele-
gation of specific powers to Congress to obtain passage of New
Deal legislation ;
One written in 1942 favored the "modernization" at that time
achieved by the "new" Court after Roosevelt's appointees had
been added ;
A third written in 1940 recommended the writings of George-

Seldes and Arthur Garfield Hays, as well as publications of the-
American Civil Liberties Union .
Between 1944 and 1947 when the second grant was made by the
foundation, Dr . Cushman wrote another pamphlet for the public
affairs committee (in 1946), which was along the line of views ex-
pressed by the Commission on the Freedom of the Press .
In 1948, the year the foundation made a grant of $110,000 to the
project, Dr . Cushman again contributed a public affairs committee-
pamphlet, New Threats to American Freedom, specifically concerned .
with the anti-Communist drive . Because the abridgment of the civil
liberties of any group (apparently even those of Communists in his
opinion) endangers all civil liberties, Dr . Cushman argued, patriotic
and loyal Americans cannot permit such a thing to happen, par-
ticularly since the difficulty of defining "communism" menaces the
civil liberties of all liberals and progressives . He pilloried the House
Un-American Activities Committee, and labeled the Mundt-Nixon
bill and the Smith Act as threats to civil liberty .
In January 1947, in a paper presented to the American Academy
of Political Science, Dr . Cushman characterized as "nonsense" the
theory of guilt by association ("good boys may associate with bad
boys to do good") . Also nonsense, according to Dr . Cushman, is des-
ignating as a fellow traveler, one who-
Joined organizations in which "there turn out to be some
Communists,"
Signed petitions supporting policies "also supported by
Communists,"
Sympathized with the Spanish Republicans, "some of whom
were Communists,"
Professed a strong admiration of Russian culture and achieve-
ments .
More than a year later, in October 1948, he presented a dissertation
on the repercussions of foreign affairs on the American tradition of
civil liberties, included in the proceedings of the American Philo-
sophical Society. There is little difference between this and the
preceding paper, except that he used the technique of presenting
supposedly the opinions of others, always unnamed . He repeated
that "critics of the program" believe loyalty tests violate due process ;
requiring clearances for atomic scientists, "he has been told," impairs
the quality of their work and leads to resignations ? "many have said"
that the House Un-American Activities Committee is politically
minded-treats cases in the press-fails to define "un-American"
and "subversive ."
Concluding, he stated as his own belief that there is need for "an
objective study" to avoid "heavy inroads" into traditional civil lib-
erty . As mentioned, this was the year the foundation gave the largest
grant-$110,000 .
In the 1951 annals of the American Academy of Political Science, .
Dr. Cushman referred to the work of congressional investigating com-
mittees as similar to a "bill of attainder," and again unhesistatingly
defined a "Communist front" as an "organization in which there turn
out to be some Communists ." He "found" that social and humani-
tarian causes are weakened by guilt by association theories, because

- people fear to support such causes lest later Communists also be found
supporting them ; national security also is weakened because the
"ordinary citizen" is confused by the idea of guilt by association .
Non-governmental antisubversive measures were also criticized-he
referred particularly to the dismissal of Jean Muir by General Foods-
and in Dr . Cushman's opinion, "it is hard to find any evidence that
loyalty oaths of any kind serve any useful purpose beyond the purging
of the emotions of those who set them up ."
Walter Gellhorn, o f Columbia University
A second collaborator in the Cornell studies, Walter Gellhorn, is
apparently actually their director, and the author of a major volume in
-the studies, Security, Loyalty, and Science .
Dr. Walter Gellhorn is listed in appendix IX, page 471, as a "con-
scious propagandist and fellow traveler," and is in a group including
Fields, Barnes, Jerome Davis, and Maxwell S . Stewart.
He was a leading member of some 11 Communist fronts .
He was a national committeeman of the International Juridical
Association, whose constitution declares
Present-day America offers the example of a country discarding the traditions
of liberty and freedom, and substituting legislative, administrative, and judicial
tyranny .
The American section's purpose is-
To help establish in this country and throughout the world social and legislative
justice.
He is cited as an "active leader" of the National Lawyers Guild .
Appearing before the House committee in 1943, he denied the
International Juridical Association and several other fronts with
which he had been associated were communistic, had extreme dif-
ficulty remembering just what documents he might have signed,
including a declaration of the National Lawyers Guild and a cable-
gram protesting Brazil's detention of an agent of the Communist inter-
national, a man named Ewert .
Dr. Gellhorn (Harvard Law Review of October 1947) prepared
.a Report on a Report of the House Committee on Un-American Activ-
ities, specifically defending the Southern Conference for Human
Welfare, exposed as a Communist organization, and violently attack-
ing the House committee . His book for the Cornell studies indicates
Dr . Gellhorn had not changed his opinion either of the southern
conference or the House committee .
The Daily Worker, March 15, 1948, under a heading "Gellhorn
Raps 'Un-American,' " quoted from an article by Dr . Gellhorn (Amer-
ican Scholar-Spring 1948), in which he likened the House Un-
American Activities Committee to a "thought control" program,
and declared, "More important than any procedural reform, however,
is conscious opposition to the House committee's bullying."
Dr. Gellhorn begins Security, Loyalty and Science, by expressing
his fear that strict security regulations "would immobilize our own
scientific resources to such an extent that future development might
be stifled while more alert nations overtook and surpassed us ." In spite
of a lack of reciprocity on the part of others, Dr. Gellhorn believes that
the fruit of our work should be fully published and not restricted,
even if, as he offhandly puts it, there is "no neat balance between the
outgoing of our information and intake * * *" which in his opinion

may "* * * be entirely irrelevant."
His theme is that security regulations and loyalty programs are use-
less and dangerous . He cites particularly category B of the Atomic
Energy Commission, covering "undesirables"-those having sym-
pathetic interests or associations with subversive ideas, friends, rela-
tives, or organizations . Like Dr . Cushman, Dr . Gellhorn found it.
even "more alarming" that nongovernmental agencies are increasingly -
requiring clearances ; he dismissed the House Un-American Activities .
Committee as indulging in repetition and exaggeration and added that
they are responsible for scientists refusing to work for the Govern-
ment. He belittled the Attorney General's list, its designations to
him to have no pattern, and he questioned the reliability of the con-
fidential information frequently used.
He concluded that the loyalty program originated in anti-New Deal'
politics (beginning with the Dies committee in 1938), that it is in-
effective against "the furtive, the corrupt, the conspiratorial," and "the
country will be stronger for discovering that the restraints of the pres-
ent loyalty program exceed the needs of national preservation ."
Denial of AEC fellowships to Communists is unwarranted, in Dr .
Gellhorn's opinion, and he quoted approvingly statements of others
that deplored the atmosphere of distrust and suspicion ; thought
loyalty checking brought into being a "police state" and the use of -
methods "far more dangerous than the small risk of having an occa-
sional Communist on the fellowship rolls ."
As evidence that security files are misleading anyway, Dr . Gellhorn
cited the fact that the Army in 1949 classified as "unemployable" -
Gordon R. Clapp of TVA, Professor Counts, and Roger Baldwin .
Dr. Gellhorn is also responsible for other books in this project . He ,
is coauthor of a study on States and subversion (with William B'. .
Prendergast, assistant professor of government at the Naval Acad-
emy), and of a study on the Tenney committee (with Edward Bar-
rett, Jr., professor of law, University of California, who stated, "I
am particularly grateful to Walter Gellhorn of Columbia University
for his constant advice and suggestions and for his careful reading
of the manuscript in two of its preliminary versions") .
These statements of Dr . Cushman and Dr . Gellhorn both prior to
and after their association with the Cornell studies cannot be con-
sidered as those of "unbiased" and "objective" individuals . Dr. Gell-
horn's appearance before the House Committee on Un-American
Activities in 1943 was a matter of record . It is difficult if not far-
fetched to believe that no inkling of these matters reached either the
Social Science Research Council or the Rockefeller Foundation-be-
fore or after the grants were made by the foundation . Yet as far as,
can be ascertained neither organization has had anything but praise
for the studies, and the personnel associated with it .
These then are some of the organizations selected by the Carnegie
Corporation of New York, the Carnegie Foundation for International
Peace, and the Rockefeller Foundation
To promote the advancement and diffusion of knowledge and understanding
among the people of the United States and the British Dominions .
To promote the advancement and diffusion of knowledge and understanding
among the people of the United States ; to advance the cause of peace among
nations to hasten the renunciation of war as an instrument of national policy ;
to encourage and promote methods for the peaceful settlement of internatio nal


differences and for the increase of international understanding and concord ;
and to aid in the development of international law and the acceptance by all
nations of the principles underlying such law .
To promote the well-being of mankind throughout the world .
These then are among the individuals-directly or indirectly-
designated by these Carnegie and Rockefeller foundations as those not
only best qualified to accomplish the noble purposes set out in their
respective charters, but also those most likely to do so.
These are a few of the individuals who have gained prominence and
whose reputation has been built up by the sponsorship and employ-
ment of foundations-either directly or through organizations re-
ceiving foundation funds to carry out projects approved if not selected
by them .
No indication appears in the annual reports of these tax-exempt
organizations-certainly not in those made available to the public-
that the Carnegie Corporation of New York, the Carnegie Endow-
ment for International Peace, or the Rockefeller Foundation has
disavowed the individuals, the organizations, or the results thereof,
except in a few isolated instances reported in the Cox committee
hearings .
Nor is there any indication that any one of these tax-exempt organi-
zations has taken any measures-either before or after the Cox
committee hearings-to insure that organizations as well as individ-
uals receiving their funds in the future will use such funds to make
studies which are in fact objective, not only with regard to the
material considered, but also as to personnel ; studies which will faith-
fully present facts on both sides of the issue or theory-particularly
when it is of a controversial character . Nor have any measures been
taken to prevent two equally improper uses of tax-exempt funds
first, under the guise of "informing public opinion"- propagandizing
for a particular political philosophy or viewpoint ; and second, again
under the cloak of "supplying information to the Government"-pre-
senting only information upholding a particular philosophy, or view-
point, and which if accepted will tend to influence Government
officials more and more toward socialistic solutions of current
problems .
If any such precautions have been taken then discussion and de-
cision as to them does not appear in the published reports, nor has any
publicity been given to the fact .
KATHRYN CASEY,
Legal Analyst .
JULY 1, 1954.
EXHIBIT-PART II . CARNEGIE
EXCERPTS FROM THE YEARBOOKS OF THE CARNEGIE ENDOWMENT FOR INTERNATIONAL

PEACE AND MATERIAL TAKEN FROM OTHER SouRcEs FROM 1911-1952
(Source : Carnegie Endowment for International Peace, 1916 Yearbook :)
Page 33 : "* * * The publications of the endowment may be divided generally
into two classes : first, those of a propagandist nature, which the general public
is not expected to purchase but which the endowment desires to have widely
read ."
* * * * * * *
Page 34 : "* * * There are several other phases of the subject of the proper
distribution of the endowment's publications which the Secretary believes should
receive further consideration .
"The proposed charter of the endowment places upon an equal footing with its
scientific work the education of public opinion and the dissemination of informa-
tion. This is the proper light in which to view this branch of the work ; unless
the results of its efforts are read, appreciated, and utilized, the time, energy,
funds of the endowment will be wasted . The problem therefore is deserving
of the same serious thought as the problems of scientific work, which have here-
tofore received the chief consideration, but which now appear to be fairly solved .
"In speaking generally of educating public opinion and diffusing information,
the trustees no doubt had in mind two distinct classes of people
"(1) Those who are already of their own accord interested in the sub-
jects which come within the scope of the endowment ;
"(2) Those not now interested but who may be and should be made to
take an interest in the work ."
EDUCATIONAL WORK IN THE UNITED STATES

Page 71 : "That very important portion of the educational work carried on in
the United States, which is conducted through the American Association for
International Conciliation, has already been described .
"In addition to this the Division of Intercourse and Education has directly
conducted work of an educational character of three kinds-publicity through
the newspaper press, lectures, and preparation and distribution of material for
use in schools and by writers of school textbooks .
Publicity
"With a view to spreading an interest in international affairs and a new
knowledge of them among the people of the United States, articles on subjects of
international interest based on interviews with men of prominence in public
and business life have been prepared and offered to a large list of newspapers
throughout the country on a business basis . The opinion has been expressed by
a number of editors and conductors of newspapers that these articles have been
-of the highest value and have exerted a large influence on public opinion ."
(Source : Carnegie Endowment for International Peace, 1917 Yearbook .)

. DIVISION OF INTERCOURSE AND EDUCATION
Page 53 : "The continuance of the world war which broke out on August 1, 1914,
has caused the Division of Intercourse and Education to confine its activities to
two fields . The first includes the information and education of public opinion in
the United States as to those underlying principles of national policy and national
conduct that are most likely to promote an international peace which rests upon a
foundation of justice and human liberty . The second includes those activities
which have as their purpose the bringing of the peoples of the several American
republics more closely together in thought and in feeling . * * *"
EDUCATIONAL WORK IN THE UNITED STATES

Page 72 : "In addition to the highly important educational work conducted
for the division by the American Association for International Conciliation, two
methods of reaching and instructing public opinion in the United States have
been followed : publicity on international affairs through newspapers, and the
preparation and distribution of material for schools and writers of school text-
-books ."
Publicity
"Syndicated articles mainly consisting of interviews with leaders of opinion in
both American and European countries have been furnished to the newspapers
-on a commercial basis . These articles have not always been directly concerned
with questions of international peace, but have furnished unusually valuable
information on the public opinion, the political life, and the intellectual develop-
ment of many nations . Their main object has been to increase in the United
States the amount and accuracy of knowledge of other countries and of their
peoples . It is believed that the best foundation for international friendship
and international justice is to be found in a thorough knowledge of our neighbors
and a true appreciation of their institutions and their life ."
CONCLUSION
Page 82 : "It is probable that the greatest war in all history is approaching its
end . At this moment no one can predict just when or how this end will come, but
there are plain signs to indicate that a crisis has been reached beyond which
human power and human resources cannot long hold out. It will be the special
privilege and the unexampled opportunity of the Carnegie Endowment for Inter-
national Peace to take active part in the work of international organization which
must closely follow on the conclusion of the war . For that task this division is
making itself ready by study, by conferences, and by persistent effort to prepare
public opinion to give support to those far-reaching projects based on sound
principle which if carried into effect will do all that present human power can to
prevent a recurrence of the present unprecedented calamity ."
(Source : Carnegie Endowment for International Peace, 1918 Yearbook, p . 65 :)

DIVISION OF INTERCOURSE AND EDUCATION
"The instruction of public opinion in this and other countries, the sympathetic
cooperation with established effective agencies for the spread of accurate knowl-
edge of international relations and international policies, and the cementing of
those personal and national friendships which the war with all its separations
has so greatly multiplied, have solely occupied the attention of the division . To
these purposes its resources have been exclusively devoted ."
(Source : Carnegie Endowment for International Peace, 1920 Yearbook, p . 62 : y

EDUCATIONAL WORK
"A wide distribution of books, pamphlets, and periodicals has been made from
the offices of the division, with the definite aim of informing public opinion on
questions of international significance, and the educational activity of the policy
clubs, together with the limited but important work in summer schools, have
proved an effective means of developing the international mind ."
(Source : Carnegie Endowment for International Peace, 1923 Yearbook, p . 58,

division of intercourse and education :)
"It is the established policy of the division to try to keep important person-
alities in various lands informed as to influential expressions of opinion on
foreign affairs made in this country . With this end in view a list of the names
and addresses of over 500 persons eminent in their own countries is maintained
at the division headquarters . This year the list has been extended to include
representatives of Germany and Austria . Among the expressions of American
opinion circulated by the division during the period under review were : Shall
Our Government Cancel the War Loans to the Allies? by Justice John H. Clarke ;
The State of Our National Finances, by Edwin R . A. Seligman ; Intelligence and
Politics, by James T. Shotwell ; Toward Higher Ground, by Nicholas Murray
Butler ; and What of Germany, France, and England? by Herbert Bayard Swope .
That such pamphlets are carefully read and discussed in this country, it is the
judgment of the division that it is of sufficient importance to be brought to the
attention of representative personalities in other lands to be read and discussed
by them . The division assumes no responsibility for the contents of any books .
or articles so circulated save such as appear authoritatively over its own
name * * * ." [Italics supplied .]

'908 TAX-EXEMPT FOUNDATIONS
(Source : Carnegie Endowment for International Peace, 1925 Yearbook, division

of intercourse and education, pp . 49-50 :)
"In respect of the general problem of international peace, public opinion is now
almost everywhere persistently in advance of the action of governments . Only
in rare cases do existing governments fully represent and reflect either the noblest
ambitions or the highest interests of their own people in the discussions which
are going forward throughout the world . * * *
"Few proposals could be more futile than that merely to outlaw war . Such
outlawry would only last until human passion broke down its fragile barrier .
The neutrality of Belgium was amply protected by international law, and the
invasion of the territory of that country on August 4, 1914, was definitely and
distinctly outlawed . Nevertheless it took place . Precisely the same thing will
happen in the future, no matter what the provisions of international law may be,
if the springs of personal and national conduct remain unchanged . Forms do
not control facts. Laws must reflect, but cannot compel public opinion * * * ."
If such laws are to be truly effective, they must be not enforced but obeyed .
"They are only obeyed, and they only will be obeyed, when they reflect the over-
whelming public opinion of those whom they directly affect . Once more, there-
fore, the path of progress leads to the door of conduct, both personal and national .
"It is beyond the limits of practical education or practical statesmanship to
convince public opinion that there is not, and never can be, any cause for which
men should be ready to lay down their lives if need be . The history of human
liberty and the story of the making of free governments offer too many illustra-
tions to the contrary . What is practicable is so to instruct, to guide, and to form
public opinion that it will insist upon such national conduct and such public
expressions on the part of representatives of governments as will promote inter-
national understanding and international cooperation, as well as reduce to a
minimum those incidents, those policies, and those outgivings, whether on the
platform, on the floor of parliaments, or in the press, that constantly erect such
effective and distressing obstacles to the progress of international concord and
cooperation."
* * * * * * *
Page 52 : "Underneath and behind all these undertakings there remains the task
to instruct and to enlighten public opinion so that it may not only guide but com-
pel the action of governments and public officers in the direction of constructive
progress. There must be present the moral conviction that a peace which rests
upon liberty and justice is an ideal so lofty that no effort and no sacrifice may
properly be spared in the task of securing its accomplishment. When this stage
is reached it will not be necessary formally to limit armaments ; they will atrophy
from neglect and disuse.
"It is from precisely this point of view that the work of the division of inter-
course and education has, from the beginning, dealt with the problem of inter-
national peace . The division has studiously refrained from mere sentimental
expressions, and from participation in those futile acts which repel much more
than they attract the support of right-minded men and women . The division has
devoted itself for 15 years, and it will continue to devote itself, to the develop-
ment among men and nations of the international mind . `The international
mind is nothing else than that habit of thinking of foreign relations and business,
and that habit of dealing with them, which regard the several nations of the
civilized world as friendly and cooperating equals in aiding the progress of civili-
zation, in developing commerce and industry, and in spreading enlightenment
and culture throughout the world' ." [Italic supplied .]
(Source : Carnegie Endowment for International Peace, 1928 Yearbook, p . 38,
division of intercourse and education :)
ADMINISTRATION OF THE DIVISION IN THE UNITED STATES
"In addition to this stated work a large part of the activity of the division is
devoted to the carrying out of specific, definite, and well-considered projects of
demonstrated timeliness, such as those to be described in the following pages .
These projects might be subdivided to include, on the one hand, those in which
the work is directed and supervised from the headquarters of the division and
those which are carried out by the organizations or individuals to whom allot-
ments are made from time to time . For instance, not only was the European trip
of editorial writers planned by and details arranged from the division offices, but
two members of the staff, the assistant to the director, and the division assistant
accompanied the party for the entire trip and were in charge of all administrative


details . The correspondence and careful arrangements necessary in connection
with the work of the visiting Carnegie professors of international relations are
also done from the division offices . On the other hand, when an allotment is
made by the executive committee to such organizations as the Interparliamentary
Union, the Institute of Pacific Relations, or Dunford House Association, the
work is administered by these organizations who report to the division upon the
work when completed. As has already been said, these allotments are always
made in support of definite projects . It is not the policy of the division to grant
subventions continuing from year to year to organizations or undertakings not
directly responsible to the administration of the division itself . * * *" [Italic
supplied .
(Carnegie Endowment for International Peace, 1930 Yearbook, p . 108 :)

"* * * But it is not enough to have academies of this kind . The youth of each
country should be instructed in international duties as well as in international
rights in the colleges and universities of the nations at large . Therefore it is
that the professors of international law and of international relations in the
colleges and universities of the United States have met in conference in order
to discuss and to agree upon the best methods to reach and to educate the youth-
primarily of the United States-in the principles of international law and the
bases of foreign relations . There have been four meetings : The first in 1914,
the second in 1925, the third in 1928, and the fourth in 1929 ."
t Source : Carnegie Endowment for International Peace, Yearbook, 1934 :)

Page 22 : "* * * The attitude of the endowment toward applications from
other organizations was fully explained in the secretary's report 2 years ago,
where it was stated that `The attitude of the endowment with reference to its
support of other organizations in the same field presented a difficult question
-during the first half of the endowment's existence, but its experience has resulted
In the definite policy of applying the revenue at its disposal to work carried on
with the approval of its trustees and under the direct supervision of its own
officers or agents,' What could not be undertaken during the earlier years of
the endowment's existence, because of the war and its aftermath, so soon as
the echoes of the war had died away was vigorously undertaken . A worldwide
organization has been built up at a minimum of administrative cost, through
which the endowment is in contact with the public opinion of nearly every land .
'The endowment is consequently not a money-granting, but an operating, body,
and it operates through its own agencies either directly or through those which
become substantially its own through their spirit and method of cooperation ."
Page 22 : A review of the activities of the endowment since the world

war, carried on separately through three main divisions, but operating as a unit
in behalf of the great ideal of its founder, seems to justify the observation that
the endowment is becoming an unofficial instrument of international policy,
taking up here and there the ends and threads of international problems and
questions which the governments find it difficult to handle, and through private
initiative reaching conclusions which are not of a formal nature but which
unofficially find their way into the policies of governments."
* * * * * *
Page 44 : "* * * If the world is to return, and without delay, to the path of
progress, it must be given leadership which is not only national but international .
It must find minds and voices which can see the whole world and its problems,
and not merely those of one neighborhood since important problems which are
purely national have almost ceased to exist ."
REPORT OF DIVISION OF INTERCOURSE AND EDUCATION

Page 47 : "The work of the division during the year shows definite progress
along the path of constructive work for the education of public opinion through-
out the world . This advance could not have been accomplished had it not been
for the efficient and well ordered work of the central office where cost of over-

head is reduced to a minimum and where the staff, in full conformity with the
NRA regulations, is faithfully carrying on its tasks ."
• * * * s * *
Page 53 : "While in the broadest sense all the work of the division is educa-
tional there are certain items which fall definitely under this head in making
a report on the year's work . They have all been carried on with a view to the
general enlightenment of public opinion and to encourage further study along
international lines rather than as definite and continuing projects, such as
those to be described later, which are an integral part of the work of the
division ."
•
Page 96 : "It is plain from what has been written that the year has been one
of constant study and vigorous work despite the fact that the world atmosphere
has been distinctly discouraging . That economic nationalism which is still
running riot and which is the greatest obstacle to the reestablishment of pros-
perity and genuine peace has been at its height during the past 12 months. If
it now shows signs of growing weaker it is because its huge cost is beginning to
be understood. It is only by such education of public opinion as that in which
the division of intercourse and education is so largely engaged that this violently
reactionary movement can be checked and there be substituted for it such inter-
national understanding, international cooperation, and international action as
the needs and ideals of this present-day world so imperatively demand ."

Page 180 : "* * * The major portion of the present work of the division of inter-
course and education is devoted to educating public opinion in the significance of
this forward-facing and constructive program for international cooperation .
"What I want to point out to the newer trustees is that what has been going
on for 18 years is the result of most careful study and reflection, a result of
consultation with leaders of opinion in every land, and is justifying itself not
in any quick action by governments, but in the very obvious growth of public
opinion."
• * * *
Page 182 : "As to the work of the division of international law, that is a
business of instruction, . a business of education, a business not to make all
members of a democracy international lawyers, but to put everywhere possible
the material by means of which the leaders of opinion in all communities may
know what are the real rights and duties of their country, so that it may be
possible for the people who do not study and are not competent to understand,
to get a source of intelligent and dispassionate information . And that process
has been going on steadily.
"We had one very important illustration of the advantage of it during the
past year . I really do not know how the Far-Eastern work of the late Con-
ference upon the Limitation of Armament could have been done without Mac
Murray's book which had Just, a few months before been published by the
endowment . The whole process of ranging the nine nations represented in
the conference upon a basis of agreement for the treatment of Chinese ques-
tions so as to facilitate the heroic efforts of the Chinese people to develop
an effective and stable self-government would have been exceedingly difficult,
if not impossible, if we had not had those two big volumes published by the
endowment upon our tables for access at any moment . We were continually
referring to them and the members could turn to such a page and find such
a treaty and such an agreement and have the real facts readily accessible . If
the tentative arrangement towards helping the Chinese in their struggle works
out, as I think it will, the publication of those books, at the time when they
were published, will be worth to the world all the money that has been spent
on the division of international law from the beginning . There were a dozen
other books to which we continually referred."
Source : Carnegie Endowment for International Peace, 1941 Yearbook, Report

of the Division of Economics and History, p . 117 : )
"* * * All history shows, however, that these appeals to man's higher nature
have had no permanent effect except where substitutes for war have been found


which could be used effectively in the settlement of disputes . The peace move-
ment of the twentieth century owed whatever real strength it might have
possessed to the fact that for the first time it concentrated upon this constructive
aspect of the problem . Unfortunately, however, this method of approach was
too new tb be fully understood, with the resultant failures culminating in the
present war . The events of the last 5 years, since Japan tested the peace
machinery in the Far East, and then Italy and Germany followed its example
in Africa and Europe, have clearly shown that if civilization is to survive
somehow or other the peace machinery must be brought back into operation .
The problem which confronted the makers of the League of Nations has again
become a vital issue . The increasing awareness of this fact, not only here
but in Great Britain and in the Dominions of the Commonwealth, is evidenced
by the growth of a considerable number of bodies for research and discussion .
Of one of these, the Commission to Study the Organization of Peace, the Director
of this division was chairman, although in a purely personal capacity. Men-
tion is made here of this effort because of the light which it throws upon the
nature of the problem itself. It would be hard to find a greater contrast than
between the background of the thinking of today and that of the vague and
uncertain beginnings of similar discussions in 1917 . The experiences of the
League of Nations has after all taught us much, its failures equally with its
:successes. The most surprising feature, however, is the record of the Interna-
t ional Labor Organization in the field of social welfare, a unique and wholly
new experiment in international legislation. It is this kind of planning for a new
world order on a cooperative basis which furnishes the constructive program of
the peace movement at the present time . It is therefore important to ensure
the preparation of careful and thoughtful monographs in the various fields
-covered by these surveys in order to prevent a recurrence of the superficiality
which marked so much of the peace movement of the 1920's . It is here that the
division of economics and history continues to offer the contribution of specific
-objectives and definite studies such as those indicated below ." [Italics supplied.]

Page 27 : "The aims which the division pursues and which it urges constantly
.and steadily upon public opinion in the United States, in the Latin American
democracies and in the British Commonwealth of Nations are definite and
authoritative. They are three in number .
"The first is the formal proposal for world organization to promote peace made
by the Government of the United States in 1910 . This was contained in the
joint resolution passed by the Congress without a dissenting vote in either the
Senate or the House of Representatives and signed by President Taft on June
25,1910 ."
Page 28 : "The second is the statement of principles adopted by the interna-

tional conference held in London at Chatham House on March 5-7, 1935 . This
conference, called by the Carnegie Endowment, remains the outstanding Interna-
tional conference of recent years."
Page 29 : "The third is the important Atlantic Charter as declared by the

President of the United States and the Prime Minister of the Government of
Great Britain on August 14, 1941, which may be regarded as an endorsement
of, and a suppement to, the principles proposed by the conference held at Chat-
ham House."
Page 30 : "It is these three declarations of policies and aims which are the
subject of the worldwide work of the division of intercourse and education .
'They are the outgrowth of war conditions and of the threat of war . They are
constructive, simply stated and easy to understand. As rapidly as other nations
are set free to receive instruction and information in support of this three-
fold program, that instruction and information will be forthcoming . The war
may last for,an indefinite time or it may, through economic exhaustion, come to

an end earlier than many anticipate . In either case, the division of intercourse
and education is prepared to carry on in the spirit of Mr . Carnegie's ideal and
of his specific counsel ."
Page 91 : "The division likewise cooperates with various Government offices

and with international organizations . Thus during the past year it has aided
the Department of State in editing the many papers submitted to the ninth
section (on international law, public law, and jurisprudence) of the Eighth
American Scientific Congress . Such cooperation is appropriate because officers
of the division served as chairman and secretary, respectively, of section IX, and
the division's staff acted as the section's secretariat . Cooperative relations are
also maintained with the Office of the Coordinator of Inter-American Affairs and
with other Government agencies . Of a somewhat similar nature are the rela-
tions maintained with such international organizations as the Pan American
Union and the Inter-American Bar Association . The assistance thus rendered
to organizations official and unofficial, often requires the expenditure of much
time, but it should be added that the relationship is not infrequently of mutual
benefit since the division is often in a position, as a result thereof to obtain data
which might not otherwise be readily accessible to it."
* * * *

Pages 29-30 : "The policies which were put in operation a quarter of a century
ago, with the approval of more than 200 of the leading statesmen and intellectual
leaders of the whole world, have proved to be most satisfactory and most impor-
tant . Literally millions of human beings have been led to read together and to
discuss the facts and the forces which constitute international relations and which
make for peace of the country. Thousands of groups in the United States and
hundreds of groups in other lands gather regularly to discuss the books that are
provided by the endowment and to hear the lectures which are offered by visiting
Carnegie professors .
"The work of the division has carefully avoided the merely sentimental or
that sensational propaganda for peace which is all too common . It has based
its work, and will continue to do so, upon the intellectual forces which alone
can guide the world in the establishment of new and constructive policies of
international cooperation to make another war such as now rages practically
impossible."
Page 36 : "Preparation of Programs for Secondary Schools : Special inquiry

into the needs of secondary schools in the field of international relations study,
under the direction of Professor Erling M . Hunt, of Teachers College, Columbia
University, was carried on in cooperation with the Commission to Study the Or-
ganization of Peace. A group of New York City high school teachers took part
in a summer working conference for a week. They planned and drafted an 80-
page booklet which included reading and study suggestions for the use of senior
high school students entitled Toward Greater Freedom : Problems of War and
Peace . This has been published and distributed by the Commission to Study the
Organization of Peace.
"The School of Education of Stanford University, California, was assisted by
the division in bringing together, in July, a group of high school teachers and
administrators from schools in the Pacific Coast and Mountain States . The
group devoted 2 weeks to intensive analysis of war issues and postwar problems
as they affect the curriculum and the individual teacher . As a result a report,
Education for War and Peace, embodying the findings of the groups and in-
tended as a pamphlet for immediate use in schools, has been published by the
Stanford University Press ." [Italics supplied .]
* * * * * * *
Page 37-38 : "Any doubts which might have been entertained as to the value of
the International Relations Club work in colleges and universities, during the long
years in which the endowment has been operating, must have been completely dis-
pelled by the magnificent response that has come from both faculty advisers and
students during this period of disruption and confusion caused by the present
worldwide catastrophe. Each of the 12 regional conferences was carried through
during the calendar year 1942 . This is the more remarkable since difficulties
have increased rather than lessened as the war progresses . Almost every letter
received at the opening of the academic year announced that faculty advisors
were leaving their respective campuses to serve in the armed forces or to support
in advisory capacity Government defense projects, but even when called away
summarily these faculty members have found time to appoint successors and to
write a heartening letter as to the importance of carrying on . The drain upon
the student body through induction into the Army has been overwhelming . In
many of the colleges students are using their spare time in local war industries
or in defense work if they have not actually left college, and most of the studies
have been directed along engineering and other lines closely connected with the
war effort . But even the boys who know that within a few weeks they will be
In a military camp have tried to learn the deeper causes of the war through con-
tinued attendance at the club meetings, and at many of the conferences uniforms
have been in evidence, worn by ex-club members who have been granted permis-
sion to attend . In fact, the clubs have continued with more enthusiasm and
vigor than ever before .
(Source : Carnegie Endowment for International Peace, 1944 Yearbook, pp-

70-74 :)
"Many problems of international organization and administration are confront-
ing the United Nations authorities, and problems of that nature will assume far
greater importance as the war draws to an end and postwar activities undergo
the large-scale development now anticipated . Foreseeing such a trend, the di-
vision has given much attention to this field during the past 2 years .
"There is, of course, no international civil service to evolve formal rules, prac-
tices, and precedents for future guidance in international administration ; and
although there has been encouraging progress in methods of international organi-
zation, those methods are not as yet beyond the trial-and-error stage . Moreover,
the literature in these fields is extremely inadequate . Yet valuable experience has
been acquired in both administration and organization, especially by the Secre-
tariat of the League of Nations, the International Labor Office, and other inter-
national agencies, some of which have functioned successfully over a considerable
period of years . This experience- however, is contained partly in unpublished
records and, to an even greater extent, in the memories of those who have
served in the organizations in question ; and it is therefore not available for the
guidance of the many officials and agencies now actively concerned in planning
and setting up the machinery for future international cooperation .
"With a view to making available the most important features of such expe-
rience, the division has held a series of conferences which have been attended by
officials and former officials of the League of Nations and of other international
bodies, and in some instances by government officials and others especially inter-
ested in the fields of the conferences . The first of these meetings, held in New
York on August 30, 1942, was of an exploratory nature, its chief purpose being to
determine what particular aspects of the experience of the League of Nations
Secretariat might be further studied and recorded in usable form . At the end of
the following January a second conference was held at Washington, which was
devoted specifically to a survey of experience in international administration .
And some 6 months later, on August 21-22 of last year, a third conference was
held in Washington to discuss the problem of training for international admin-
istration . The proceedings of the first two conferences were issued in confidential
mimeographed editions and given a restricted distribution, chiefly among govern-
ment agencies and their personnel . The proceedings of the third conference,
however, will be of interest to a much wider group, including not only officials
but educators and others deeply concerned with the need of adequate training for
the staffs of many international agencies which are either in process of forma-
tion or are contemplated for the postwar period . For this reason, the proceedings
of the third conference have been carefully edited and supplemented with docu-
mentary materials, and printed for a wider distribution."
"As a result of the conferences and related activities, as well as of the studies
made by its staff, the division has established useful relations with many highly
qualified and experienced experts, and this in turn has made it possible to plan
and arrange for the preparation of a series of studies by a number of these
experts on international organization and administration . The studies, more
fully described below, record both experience and precedents in the fields in
question and constitute a rich source of information which, in the main, has
hitherto been inaccessible .

"These activities of the division have placed it in a peculiarly strategic post

tion to cooperate with official agencies preparing to undertake important inter-
national functions . At the outset, such agencies are, of course, confronted with
problems of organization and administration, and it is a matter of urgent neces-
sity for them to obtain materials which will assist them in meeting these prob-
lems . It is a source of great satisfaction to the director that the division has
been in a position to supply such materials . Without attempting to list these,
instances of cooperation in detail, mention should be made here of a few ex-,
amples by way of illustration.
"For some months, the Office of Foreign Relief and Rehabilitation Operations .
(OFRRO) was engaged in preparations for the organizing conference of the
United Nations Relief and Rehabilitation Administration (UNRRA) held at
Atlantic City, November 10 to December 1, and it frequently called upon the
division to assist by various means in these preparations . Thus, in August, the .
division was able to arrange to have several officials of the League of Nations
come to Washington to take part in discussions of plans for the administrative
budget of the new organizations . In a letter to the endowment former Gov.
Herbert H . Lehman, then director of OFRRO and recently chosen director of
UNRRA, wrote expressing his `great appreciation for the very real contribution
which you and the Carnegie endowment made to our preparations for a United
Nations Relief and Rehabilitation Organization,'
"Members of the staff of OFRRO were early supplied by the division with
the materials assembled as the result of the several conferences on international
organization and administration above mentioned . As the date of the confer-
ence in Atlantic City approached, the division received numerous additional and
more urgent requests for assistance from OFRRO . In compliance with these
requests, several special memoranda were prepared under great pressure for use
in connection with the UNRRA conference . These dealt with the following
subjects :
"International Conferences and Their Technique
"Precedents for Relations Between International Organizations and Nonmember
States
"Status of Observers at International Conferences
"Seconding by International Organizations and from National Services to In-
ternational Agencies
"The Creation, Composition, and Functioning of Standing Committees of UNRRA
"The appreciation with which these contributions from the division were
received can hardly be overstated .' As an illustration, mention may be made
of a personal note of November 17 received by the director from Dr . Philip C .
Jessup, a member of the endowment's board of trustees, and then serving as
Assistant Chief of the Secretariat of UNRRA . After describing one of the
documents as having proved `most helpful in the solution of some troublesome
problems' ; and expressing amazement that it had been possible to supply 'so
thoughful and so complete a document under such enormous pressure of time,'
Dr. Jessup referred to other materials supplied by the division as being 'also
very much appreciated,' and added : 'I think the endowment is certainly entitled
to congratulate itself upon the contribution it has made to the smooth func-
tioning of international organizations which, to a large extent, must be the
mechanical means of developing international peace .'
"It should be added that, in addition to these special memoranda, the division
supplied several copies of its various publications relating to international
organization and administration to the library of the conference at Atlantic
City. Shortly after the conference met, an urgent request was received from the
American delegation at Atlantic City for additional copies of these publications,
to be sent to the conference by special courier . The division was, of course,
glad to meet this request . Of a somewhat different nature were the numerous
urgent inquiries for specific information received from officials connected with
the conference . These inquiries dealt with such topics as relations of former
enemy governments after the last war .with the American Relief Commission,
diplomatic immunities of members of international organizations, and staff regu-
lations of such organizations . In each instance, the division was able either
to supply the information requested, or to indicate the best source from which
it could be obtained .
"Similarly, though to a somewhat lesser degree, the division has cooperated
with the recently created Interim Commission of the United Nations Conference
on Food and Agriculture . . Copies of, the endowment's publications on interna-
tional organization and administration were supplied to the Commission the
TAX-EXEMPT FOUNDATIONS 915,
director and other members of the division staff have conferred with the .
executive secretary of the Commission on problems relating to the constitution, .
organization, and staffing of the newly created .body ; and the division has
supplied the Secretariat with data on inter-American agencies dealing with,
problems in the fields of food and agriculture .
"In addition to such special inquiries, the division receives from day to day, .
often by telephone, requests for information from government offices on techni-
cal subjects in the international field. Although these are too numerous to list
here, it may be said that they are answered as fully as possible and as promptly
as is consistent with scrupulous accuracy . The assistance rendered by the
division has not been limited, however, to American and international agencies .
It maintains cordial and often mutually helpful relations with the diplomatic
missions in Washington and frequently supplies them with published materials
and other data .
"These studies, mentioned on a previous page, are in fact competently written
monographs . Because of the urgent demand for such materials, they are being
issued in preliminary form in small mimeographed editions . It is the Director's
belief, however, that they have much more than a transitory value, and that as,
soon as is practicable some of them should be published in revised and permanent
form . The folowing list comprises the studies already issued in mimeographed
form
"Memorandum on the Composition, Procedure, and Functions of the Committees
of the League of Nations
"International Conferences and Their Technique-a handbook
"International Drug Control, a Study of International Administration by and ,
through the League of Nations
"The League of Nations and National Minorities, an Experiment
"The following studies are now being prepared and will be published during
the coming year
"The Situs of International Organization
"Diplomatic Immunities and Privileges of Agents and Staff Members of the-
International Organization
"Relations Between International Organizations and Nonmember States
"The Participation of Observers in International Conferences
"The Ecoomic and Financial Organization of the League of Nations
"The League of Nations' Mandates System
"The League of,Nations' Secretariat
"Financing of International Administration
"The names of the authors of these studies are being withheld for the present . .
They are all, however, present or former officials competent from actual expe-
rience to deal with the subjects involved ." [Italics supplied.]

THE LIBRARY AND INFORMATION BUREAU
Page 25 : "The work of the library has continued along the same general lines
described in previous reports . In accordance with the policy adopted in 1942,
governmental agencies were given precedence in the use of the library's mate-
rials . In addition, its resources have been used by numerous foreign embassies
and legations and by the participants of such international meetings as those ,
at Dumbarton Oaks. Scholars, press representatives, professors, and interna-
tional, national, and local organizations have also been served .
"The ever-increasing discussion of the peace to follow the present war has
brought renewed demands for information on the subject . The endowment's
library is known in Washington for its wealth of material on peace and inter-
national organization and for its services in making these materials available.
As a result, library staff members have spent an increasingly large proportion of
their time in reference work with visitors . At the same time, due to the accel-
erated publication progr$m in the Division of International Law, reference work
for the endowment staff has been tremendously increased ."
Page 30 : "The proposals of statesmen and of public leaders for United Na-
tions organization and the formation of general opinion on these plans have
been the basis of growing action during the past year in the extension of the
division's work . Both by continuous contact with central groups operating pro-
grams of study in the main regions of the country and by collaboration with local,
institutes and councils, this important interest has been pursued . The announce-

ment of the Dumbarton Oaks proposals heightened its significance in the last
quarter of the year and gave immediate political reality to it as an issue facing
our people.
"The development of centers in many part of the country, for organizations
associated with the endowment, has been described in preceding reports . The
brief summary of their expanding activities which can be given here demon-
strates that, although the programs and methods of the various centers differ,
there is agreement as to their fundamental purpose : to educate public opinion
in regard to the underlying principles essential to security after the war and to
welfare throughout the world."
* * * * *
Page 103 : "A:
"As this
this report goes to press, the interest of the civilized world cen-
ters upon the United Nations Conference on International Organization meeting
at San Francisco on April 25. As this event promises to be the culmination of
much in the program of planning and policy advocated repeatedly in the annual
reports of this division and in its work and that of its director in affiliated organi-
zations, it is fitting to comment upon it and the nature of the peace settlement
at the end of the Second World War, of which it is so important a part. There-
fore, without in any way attempting to anticipate what may or may not be done
at the San Francisco Conference, it seems not only valid but necessary to link
it up with the outlook and activities of the Endowment .
"During the past 5 years, both within the program of the division itself and in
connection with the research work for the International Chamber of Commerce
and the Commission To Study the Organization of Peace, the director has been
engaged upon a comprehensive series of studies dealing with postwar economic
policies and international organization * * * .
* * * * * *
Pages 105-106 : "The provision of the Dumbarton Oaks proposals for the erec-
tion of an Economic and Social Council under the Assembly, a provision unfortu-
nately absent from the Covenant of the League of Nations, has not yet received
anything like the attention which it deserves . Naturally the provisions for
security take the precedence in all discussions of the plan for world organization,
but in the long run the provision for the economic organization is more important,
if the security organization succeeds in the establishment of peace for even a
generation . The advancement of science will ultimately outlaw war, if it has not
already done so, but creates vast new problems in the field of economic relation-
ships.
"This inescapable'conclusion is now widely shaded by thoughtful people, but
its application in practical politics is by no means assured in the most enlightened
countries. Here, therefore, is the area of international relations in which the
Carnegie Endowment for International Peace should continue to concentrate .
The affiliation with the International Chamber of Commerce should be strength-
ened through the Committee on International Economic Policy . At the same
time the interplay of all these forces making for peace and international under-
standing is translated into concrete form by the Commission to Study the Organ-
ization of Peace with which this division of the endowment has also been closely
associated .
"It is, however, fitting and proper now to record the fact that the director of
the division was consultant in the State Department for a year and a half during
all of the earlier phases of the planning of the General International Organiza-
tion agreed upon at the Moscow Conference and finally developed in the Dumbar-
ton Oaks proposals. The plans of the small subcommittee on postwar organiza-
tion, meeting under the chairmanship of the Under Secretary, Mr . Sumner Wells,
of which the director was a member, have remained basic throughout the period
of negotiation . The director was also a member of the Security Committee,, the
agenda of which covered, among other things, the problem of armaments, and
the Legal Committee, concerned with American participation in an International
Court of Justice, and other problems of international law . More important, from
the standpoint of practical politics was the political committee in which some
members of the technical committees sat in conference with some of the leading
Senators and Congressmen under the chairmanship of the Secretary of State .
These formal discussions, which were held almost every week for several months,
have borne good results in strengthening the relations between the executive
and legislative branches of the Government with reference to the postwar settle-
ment . It goes without saying that Secretary Hull, aware from long experience
of the need of cooperation between the State Department and Congress, did not


by any means limit his contacts to these formal meetings . Nevertheless, they
were of real importance in the clarification of policy .
"In the field of cultural relations, the director resigned his chairmanship of
the National Committee on International Intellectual Cooperation, an office which
he had held by virtue of his membership of the Organization of International
Intellectual Cooperation of the League of Nations . At at conference of repre-
sentatives of the various national committees of the Latin-American countries
held in Washington, he was elected member of a small international committee
created to give effect to the resolution of the Havana Conference of 1941 . Prog-
ress of the war, however, has interrupted this development and the organizing
committee is happily faced with a new and much more developed plan for post-
war organization in cultural relations under the auspices of the State Depart-
ment, than the advisory committee of which the director was a member until
its dissolution."
i a # $ t i
PUBLICATIONS
Page 112 : "' * * General International Organization : This is a statement
prepared by the Commission To Study the Organization of Peace which sum-
marized the conclusions of past reports and recast them with reference to the
plans then under consideration for the Dumbarton Oaks Conference . It is grati-
fying to note the many points of this statement which parallel the proposals of
that conference. Upon the conclusion of the conference, the commission issued
a statement to the press which was commented upon in a letter to the director
by Edward R. Stettinius, Jr., then Under Secretary of State, as follows : `The
statement is another indication of the notable service in working for an objective
and scientific approach to the problems of international organization which has
marked the publications of the Commission To Study the Organization of Peace
in the past."'
s s s s s 4
EDUCATION
Page 114 : "When the Dumbarton Oaks proposals were made public, the com-
mission called together the heads of 75 national organizations to discuss a wide-
spread educational program to bring the proposals before the American public .
These groups have been meeting regularly in New York City, discussing both
publications and education techniques. Representatives from the Department
of State have been attending the meetings .
"The commission has cooperated also in the regional conferences at which
representatives of the State Department have met with organizational leaders
in off-the-record discussion of the proposals . Meetings were held in Portland,
Salt Lake City, Detroit, Salina, Dallas, St . Paul, and Atlanta . Large public
conferences on the proposals were held in New York City and other key centers,
the meetings being arranged by the commission's regional offices . In addition,
the commission continued its regular educational program, working with other
national organizations, schools and colleges, labor, farm, and business groups,
and concentrating considerable attention on rural areas and small towns.
"Special institute meetings were held in cooperation with the World Alliance
for International Friendship Through the . Churches in Dallas, Tea . ; LaFayette
College, Pa. ; Miami and Winter Park, Fla . ; Chicago, Ill . The regional commis-
sions have held other, public conferences and institutes throughout the year ."
The series of lectures which the commission has been sponsoring at the New
School for Social Research has now covered a considerable number of problems
of postwar international organization, dealing with labor, cultural relations,
mandates, plebiscites, the World Court, public health, minorities, moving of
populations, human rights, international education, and an analysis of the Dum-
barton Oaks proposals. The lecturers included Clark M . Eichelberger, Prof .
Carter Goodrich, Dr . Walter Kotschnig, Prof. Oscar I. Janowsky, Prof. Quincy
Wright, Dr. C. E. A. Winslow, Dr. Frank L. Lorimer, Mr . Beryl Harold Levy,
Dr. Hans Simons, Dr . Sarah Wambaugh, Dean Virginia C . Gildersleeve, and the
director of the division.
Over 600,000 copies of the commission's reports have been distributed and the
distribution of its popular material numbers 3% million pieces. A number of
basic pamphlets were published in 1944, including a guide to community activity
and discussion entitled, "The Peace We Want" ; a third revision of a high-school
pamphlet, Toward Greater Freedom ; a revised edition of a farm pamphlet, Win-

ping the War on the Spiritual Front ; a picture book of full-page illustrations by
the artist, Harry Sternberg, of the commission's statement of fundamentals, aa
project undertaken with the cooperation of the Committee on Art in American
Education and Society ; an analysis and comment on the Dumbarton Oaks pro-
posals, prepared by Clark M. Eichelberger. In 3 months 50,000 copies of this-
pamphlet were distributed, it being used by many groups as a basic text . A.
third printing is now being made .
(Source : Carnegie Endowment for International Peace, Yearbook 1946 : )

Pages 24-25 :
UNITED NATIONS CONFERENCE ON INTERNATIONAL ORGANIZATIONS
"The endowment was invited by the Secretary of State to send representatives.
to serve as consultants to the American delegation at the United Nations Con-
ference on International Organizations held at San Francisco, April 25-June 26, .
1945, at which the charter of the United Nations was drafted and signed . In
response to this invitation, the endowment was represented at the conference by
Dr . James T. Shotwell, director of the division of economics and history, who ,
served as a consultant, and Mr . -George A . Finch, secretary of the endowment
and director of its division of international law, who served as associate con-
sultant. A number of other trustees were present at the conference in an official
or consultative capacity . Mr. John Foster Dulles was an official adviser to the
American delegation, and Mr. Philip C. Jessup was a technical expert on judicial
organization. Endowment trustees representing other organizations were
Messrs. David P. Barrows, W. W. Chapin, Ben M. Cherrington, and Harper Sibley.
Mr. Malcom W. Davis, associate director of the division of intercourse and educa-
tion, was the executive officer of the first commission of the conference."
s s s s s s s
CONFERENCE ON AMERICAN FOREIGN POLICY
"To assist in informing public opinion concerning the foreign policy of the
United States, the endowment sponsored a conference at Washington on No-
vember 26-27, 1945, of representatives of national organizations who took part
in a discussion program with officers of the Department of State concerning :
America's Commitments for Peace. The secretary of the endowment acted ;
as its representative in carrying out the details of the conference . Eighty na-
tional organizations accepted the endowment's invitation and were represented
by its 125 delegates . The conference was greeted in person by Secretary of
State James F. Byrnes . There were four sessions. The first was devoted to
World Trade and Peace. The official statement on the subject was made by
Mr. Clair Wilcoo, director of the Office of International Trade Policy. The
second session dealt with Relief and Rehabilitation . Governor Herbert H.
Lehman, Director General of UNRRA, laid the facts of the situation before
the conference.
"At the third session, Hon . Dean Acheson, Under Secretary of State, ex-
plained the official policies toward Germany and Japan . At the concluding ses-
sion, Mr. Alger Hiss, Secretary General of the United Nations Conference at :
San Francisco, made a progress report of the United Nations Organization .
Following the presentation of the leading address or paper at each session, .
a panel of experts from the Government offices chiefly concerned answered ques-
tions propounded by the assembled representatives of the national organizations ..
At a luncheon tendered by the endowment at the close of the conference, Hon . .
William Benton, Assistant Secretary of State in charge of public affairs, ex
plained the International Information Program of the Department of State .
Letters of commendation have been received from many of the national repre-
sentatives who were in attendance, and a letter expressing . appreciation of
the cooperation of the endowment was sent by Secretary of State Byrnes to~
President Butler under date of December 7 ." [Italics supplied.]
s s a • s s
Page 45 : "As a result of the continued educational program which the Minne-
sota United Nations Committee at St . Paul has conducted for the division
throughout the year, there is reason to believe that public sentiment in Minne-
sota is favorably inclined toward the United Nations Organization and other


forms of international cooperation . This is shown by an inspection of editorial
.comment in the State."
s s s • r r s
SURVEY OF PROGRAMS OF THE UNITED NATIONS
Pages 38-39 : "Following the ratification of the United Nations Charter by the
number of nations required to put it into effect, and in furtherance of a sug-
gestion originally made by a trustee of the endowment for a survey of peace
,organizations as to their functions and effectiveness in reaching public opinion
in the United States, the division sent out inquiries to national organizations as
to what they were doing to bring to the attention of their members the commit-
ment of the United States to the United Nations . `Peace' organizations as such
form only part of the program for reaching public opinion in the United States.
A questionnaire was forwarded to 150 organizations in October, of which 29
were `peace' organizations, and the division was gratified to receive answers
from 100 of them .
"The report, compiled from this survey by Miss Cathrine Borger, of the divi-
sion staff, showed that practically every organization engaged in popular educa-
tion of various types, regardless of particular field-scholastic education, citi-
zenship education, religious, service clubs, women's organizations, youth, busi-
ness, farm, labor, specialized interests-is devoting some part of its programs to
making its membership aware of the commitment of the United States to the
United Nations .
"Among the suggestions received as to methods which should be emphasized
in developing popular knowledge of international organization were the need of
preparing single ilustrated booklets, more use of motion pictures and radio,
forums and discussion groups, as well as development of suitable publications for
schools and colleges . Education of young people was mentioned by a number of
-organizations . Six organizations maintained that personal contacts and leader-
ship provided the most effective method, and another stressed the need for divid-
ing efforts between raising the general level of `where people are' and working
-with interested groups willing to join in concerted activities . Of major impor-
tance were those stressing the necessity of developing material showing what the
United Nations Organization cannot do as well as what it can do, and of full
publicity for every activity of the United Nations, and more especially for the
activities of the United States and its delegates .
"The greatest lack in public education with regard to the American commit-
ment concerns people who are not reached by any organization, since they have
not been interested to join, and do not realize that they too constitute public
opinion and have to assume their responsibilities as citizens not only of the
United States but of the world . The Carnegie Endowment, as an institution
.seeking neither members nor maintenance by dues and contributions, is in a
position both to work with other organizations and also to respond to this need
of primary education ."
Pages 50-52 :
WORK THROUGH RADIO AND MOTION PICTURES
"During the past year Beyond Victory has been presented each week under
the combined auspices of the World Wide Broadcasting Foundation and the
endowment, over nearly a hundred stations in all parts of the United States
and Canada . This nationally known series of programs, now well into its third
year, has established itself with an audience of discriminating listeners through-
out the country as offering interest and authoritative comment or many phases
of postwar adjustment .
"In the spring of 1945 a special group of programs centered around the San
Francisco Conference of the United Nations . Two members of the American
delegation, Dean Virginia C . Gildersleeve and the former Governor of Minne-
sota, Harold E. Stassen, spoke of the general issues which the conference
faced. Dr . James T. Shotwell and Dr . Raymond Fosdick contrasted the San
Francisco conference with the Paris Conference of 1919 . The problem of
security was discussed by Dr. Quincy Wright, and colonial issues by Dr . Arthur
W. Holcombe and others. The Charter of the United Nations was discussed
by the executive officers of the four commissions at San Francisco : Mr . Malcom
W. Davis, executive officer of the First Commission, spoke on the People Write it
World Charter ; Mr . Huntington Gilchrist, executive , officer of the Second Com-

mission, on The Charter-Jobs for All ; Prof . Grayson Kirk, executive officer of
the Third Commission, on The Security Council-How It Works ; and Prof.
Norman J. Pabelford, executive officer of the Fourth Commission, on The Charter
and International Justice. The essential purpose in this group of programs
was to clarify the development of the charter in the conference at San Francisco
and to explain the functions and powers provided by its sections, for security
and welfare .
"During the past year many libraries in the United States have asked to
be put on a special list to receive copies of Beyond Victory scripts every
week . About 50 libraries in all parts of the country are now receiving this
weekly service, and many have applied for its renewal for another year. Oc-
casional Beyond Victory scripts appear on the reading tables of nearly a
hundred additional libraries which request them from time to time . They
are also sent to several leading universities and a substantial number of second-
ary schools in the United States . In addition, shipments of transcriptions of
Beyond Victory broadcasts were forwarded to Army camps and hospitals in
the United States, averaging from 10 to 12 in each shipment, and to the Mari-
anas, Saipan, and the Guadalcanal commands and the European theater. Many
letters of appreciation live been received from officers telling how these records
were used in orientation programs and convalescent wards, and describing the
favorable reaction and resulting value . A letter from the Finney General
Hospital, Thomasville, Ga ., says in part, 'Your selection of subject matter
seems to be just what we have been looking for in our orientation program,
and I wish to compliment you on the wide selection available on postwar activi-
ties.' The transcriptions were also used by the Office of War Information up
to the time that organization was dissolved ."
THE ANGLO-AMERICAN FINANCIAL AGREEMENT
Page 111 : "The executive committee concluded that many goals of the commit-
tee were at stake in the proposed Anglo-America financial agreement . It was
therefore decided to publish an objective statement concerning the British loan .
"Dr. Nicholas Murray Butler wrote the foreward to the resulting brochure,
Fifteen Facts on the Proposed British Loan, which was edited by Robert L .
Gulick, Jr . There was a first edition of 200,000 copies, and a second of 100,000
is now being printed . Hon . W . L. Clayton, Assistant Secretary of State, has
this to say about the Fifteen Facts : "Permit me to congratulate you on an excel-
lent job which I am sure will be most helpful in placing the loan before the
public in proper perspective ." Margaret A. Hickey, president of the National
Federation of Business and Professional Women's Clubs, Inc ., writes in similar
vein : 'In my opinion this is excellent material, presented in a fashion which
simplifies and clarifies the principal points involved in the legislation now
pending before Congress .'
"The board of directors agreed, without dissent, to sponsor a campaign of
public education relating to the agreement . A special committee was formed
tinder the chairmanship of Hon . Charles S . Dewey, former Congressman from
Illinois, and a vice president of the Chase National Bank. Other members of
this committee include : Robert W . Coyne, National Field Director, War Fi-
nance Division, United States Treasury ; Ted R. Gamble, Special Assistant to the
Secretary of the Treasury ; William Green, president of the American Federa-
tion of Labor ; Eric A . Johnston, president, Chamber of Commerce of the United
States ; Philip Murray, president, Congress of Industrial Organizations ; Edward
A . O'Neal, president, American Farm Bureau Federation ; Philip D. Reed,
chairman of the United States Associates of the International Chamber of
Commerce ; Anna Lord Strauss, president, National League of Women Voters
and Robert L. Gulick, Jr ."

Pages 16-17 :
RECOMMENDATION OF THE PRESIDENT
"Among the special circumstances favorable to an expansion of the endow-

ment's own direct activities, the most significant is the establishment of the
United Nations with its headquarters in New York and with the United States


as its leading and most influential members . The United States was the chief
architect of the United Nations and is its chief support . The opportunity for an
endowed American institution having the objectives, tradition, and prestige of
the endowment to support and serve the United Nations is very great . No other
agency appears to be so favorably situated as is the endowment for the under-
taking of such a program . So far as we have been able to ascertain, no other
agency is contemplating the undertaking of such a program . Consequently, I
recommend most earnestly that the endowment construct its program for the
period that lies ahead primarily for the support and assistance of the United
Nations.
"I would suggest that this program be conceived of as having two objectives .
First, it should be widely educational in order to encourage public understanding
and support of the United Nations at home and abroad . Second, it should aid
in the adoption of wise policies both by our own Government in its capacity as a
member of the United Nations and by the United Nations organization as a whole .
"'lhe number and importance of decisions in the field of foreign relations with
which the United States will be faced during the next few years are of such
magnitude that the widest possible stimulation of public education in this field
is of major and pressing importance . In furthering its educational objectives
the endowment should utilize its existing resources, such as the International
Relations Clubs in the colleges, and International Conciliation, and should
strengthen its relationships with existing agencies interested in the field of
foreign affairs . These relationships should include close collaboration with other
organizations principally engaged in the study of foreign affairs, such as the
Council on Foreign Relations, the Foreign Policy Association, the Institute of
Pacific Relations, the developing university centers of international studies, and
local community groups interested in foreign affairs of which the Cleveland
Council on World Affairs and the projected World Affairs Council in San
Francisco are examples .
"Of particular importance is the unusual opportunity of reaching large seg-
ments of the population by establishing relations of a rather novel sort with the
large national organizations which today are desirous of supplying their members
with objective information on public affairs, including international issues . These
organizations-designed to serve, respectively, the broad interests of business,
church, women's, farm, labor, veterans', educational, and other large groups of
our citizens-are not equipped to set up foreign policy research staffs of their
own . The endowment should supply these organizations with basic information
about the United Nations and should assist them both in selecting topics of
interest to their members and in presenting those topics so as to be most readily
understood by their members . We should urge the Foreign Policy Association
and the Institute of Pacific Relations to supply similar service on other topics of
international significance.
- Exploration should also be made by the endowment as to the possibilities of
increasing the effectiveness of the radio and motion pictures in public education
on world affairs ." [Italics supplied .]
(Source- Staley, Eugene, War and the Private Investor, Doubleday, 1935,
pt. III : Towards a Policy, ch . 18, Alternate Courses of Action, pp . 470-471 :)
"The search for the underlying causes of international investment friction has
revealed that capital investment is a form of contact peculiarly apt to occasion
conflict, while the existing institutions for the adjustment of these conflicts are
not only inadequate but are fundamentally ill-adapted to the task . The defec-
tiveness of the institutions of adjustment arises largely from the fact that the
areas of political loyalty and political organization on which they are based, are
smaller than the area of conflict-producing contact, which today includes prac-
tically the whole world . * * *"
* * * * * * *
"With these general considerations in mind we now turn our attention to
the appraisal of various policies which have been practiced or which may be sug-
gested in connection with the problem of reducing the political friction con-
nected with international private investment . These policies may be grouped
according to their basic characteristics under three general headings, and will be
so discussed : (1) mere anti-imperialism, (2) national supervision of investments
abroad, (3) denationalization and mondial' supervision of international invest-
ments . * * *"
3 The meaning of this special term will be explained later.

'92`2 TAX-EXEMPT FOUNDATIONS
(Pt . III : Towards a Policy, ch . 19 : Specific Suggestions :)

A WORLD INVESTMENT COMMISSION
Pages 498-499 : "The functions which might be discharged by a world commis-

sion on permanent economic contracts between nations are plentiful and import-
ant enough to justify the creation of such an agency . The World Investment
Commission, if we may give it that name, should begin the development of that
effective supervision by the world community which must gradually undermine
national diplomatic protection and render denationalization of investments
possible ."
* * * * * * *
Pages 500-501 : "How would the World Investment Commission operate? It
should have the following powers and duties
"To register international loan agreements and concessions ; to make their
terms public ; to regulate their terms in certain respects .
"To collect continuous and accurate information respecting international in-
vestment operations and all their ramifications and effects-social and political
.as well as economic.
,"To call general conferences on a world or regional basis, or conferences of
-certain industries (e . g ., concession holders, consumers, and states granting
-concessions in the oil industry) . These conferences would consider problems
raised by international capital migration, and out of them something akin to
world investment legislation might emerge .
"To cooperate with the Mandates Commission of the League of Nations, the
International Labor Organization, commissions on codification of international
law, and other international agencies whose work has a bearing on the setting
, of standards for protection of capital-importing regions against ruthless exploi-
tation.
"To examine and report on the financial condition of borrowing states 2 and
private enterprises ; to make observations on the political and social implications
of specific capital transactions .
"To call attention to any conditions likely to intensify international investment
conflicts or to occasion political friction over investments and to make recom-
mendations with respect thereto .
"To endeavor to conciliate disputes, calling conferences of lenders and bor-
rowers for this purpose, mediating, arbitrating, seeking to work out compro-
mises, employing the services of disinterested experts to provide full social and
economic information on the basis of which equitable adjustments might be
sought.
"To make a public report of its findings where a party to a dispute before the
Commission refuses to come to an agreement which in the opinion of disinterested
conciliators is just and reasonable .
"To publicly advise, after hearings, against further provision of capital to
a state or corporation which has failed to observe a contract obligation without
just cause . This would presumably make the flotation of loans difficult any-
where in the world for such a state or corporation . Here is one of the 'sanctions'
which would enable the Commission to take over the function (now exercised by
national diplomatic protection) of protecting investors abroad-that is, of
guaranteeing minimum standards of fair treatment for the investment interests
of aliens in all countries . If organized on a worldwide basis, this sanction would
be sufficient in many cases to accomplish more in the way of protection than is
now usually accomplished by diplomatic protection . At the same time, it would
tend to remove investment protection as a pretext for national aggression and
remedy other defects of the system of national diplomatic protection .
"To refer legal questions to the Permanent Court of International Justice or to
the World Commercial Court (suggested below) for an advisory opinion or final
settlement.
"To cooperate with regional organizations like the Pan American Union in the
establishment of regional subcommissions for handling investment problems that
affect mainly one part of the world ."
* * * * * * *
Page 504 : "This proposal would obviously involve the creation of an inter-
national corporation law, probably through an international treaty to be framed
and adopted under the auspices of the League of Nations. * * *"
s * * * * *
The Commission would probably deal with State loans as well as with the private
investments upon which the discussions of this volume have been focused .


A WORLD INVESTMENT BANK
Page 509 : "As a means of filtering out the national interest in world capital
movements and thereby promoting the dual process of denationalization and
mondial supervision, a World Investment Bank might perform useful functions.
Such a bank would sell its bonds to governments or to private investors and in-
vest the funds so raised in long-term construction projects, such as railways in
South America and China, airways over the world, canals, harbor works, inter-
national river improvements, and the like. * * *"
* * * * * * *
Pages 512-513 : "A useful contribution to the denationalization of international
investment (and also trade) relationships would therefore be made by the
development of a world `consular service' for the provision of detailed economic
information and the encouragement of world commerce . Such a service could
best be built on the foundation already laid by the excellent work of the League
of Nations and the International Labor Organization in the field of economic
information. * * *"
* * * * * * *
Pages 515-516 : "The League of Nations : It is worthy of note that practically
all the specific measures proposed in this chapter for dealing with the political
problems raised by international investments depend in some fashion upon the
presence of a world political organization . If the League of Nations did not exist
it would be necessary to create it, or something like it, before investment prob-
lems could be attacked with any hope of success . The League should be sup-
ported, strengthened, and developed . Its legislative powers should be increased
and its authority enlarged . Just as the loose league of sovereign States first
established under the Articles of Confederation developed into the Federal
Government of the United States of America, so the League of Nations must
be developed from a confederation of sovereign states into a federal world
government. Of course the United States, which has such a large stake in the
orderly supervision of international investment relationships, should actively en-
courage this process . An essential step is entry into the League . * * *"
* * * * * * *
Pages 517-518 : "International civic training : It is all too evident that the
measures and devices proposed in this chapter can never succeed, cannot even be
tried, unless there is a sufficient sense of world citizenship among the different
peoples of the earth and among their leaders . Such a sense of world citizenship
may be stimulated by a rational appreciation of the worldwide interdependence
of economic, social, and political life, but to be politically effective the emotions
must also be touched and loyalties to new supranational symbols must be devel-
oped. Can such loyalties be achieved short of an international working-class
revolution, or can they be achieved by such a revolution? That is one of the most
fundamental questions affecting the future form of social life on this planet . The
development of international attitudes in the schools, world intellectual co-
operation, adult education on the interdependence of the modern world, celebra-
tion of, the heroes common to all mankind-all these things, and many more at
first sight quite unrelated to international investments, have an important
bearing on the specific problem of investment friction .' * * *"
EXCHANGE OF CORRESPONDENCE REGARDING INTERNATIONAL RELATIONS CLUBS

APRIL 20, 1954.
Mr . JOSEPH E . JOHNSON,
Carnegie Endowment for International Peace,
New York, N. Y .
DEAR MR. JOHNSON : My contacts with you and the other member of the endow-
ment staff were so pleasant that it is with a keen sense of disappointment that
I now resign myself to writing for certain information instead of visiting you
in person. However, it is becoming increasingly evident that our activities
will require me to spend all my time here.
In the confidential reports, as well as the yearbooks, there are references
to "international polity clubs" which were, as I recall, established by the Car-
negie Endowment for International Peace in colleges and universities, starting
back in the early days of your organization . However, as you know time
'Consult Charles E. Merriam, The Making of Citizens (Chicago, 1931), pp. 310-318,
348, 356 .
did not permit me to read all the material you made available to me, and there
are gaps in my notes on this item . Would you, therefore, have someone on your
staff answer the following questions
1 . Were these clubs an outgrowth of or connected in any way with the Ameri-
,can Association for International Conciliation, the Institute of International
Education, or any other organizations? (And if so, how did this come about?)
2. Were they a development from the "international mind" alcoves?
In the back of my mind there is a vague recollection that during a conversa-
tion with Dr. Avirett he mentioned that these clubs resulted in organization of
the Foreign Policy Association or the Council on Foreign Relations. If I am
-correct, how did this develop and when?
3 . How many such clubs were there in 1938 and how many are there today,
if they still exist? If they no longer exist, is that due to positive dissolution
as an activity of the endowment, or due merely to student and faculty disinterest
or to some other factors?
4. I gather that each year books were sent by the endowment to each of
these clubs. Were these volumes sent without charge, at cost, or at a discount?
5. Were all books selected for distribution in any 1 year sent to all the
clubs? If not, what secondary method of selection was employed, such as the
Size of the college or university, or the club membership?
6 . How did these clubs come into being at the college or university-in other
words, did the endowment either by suggestion to the faculty or one of its
members, or through other methods foster the formation of such clubs?
7 . Were lists of books available periodically sent to the colleges and universi-
ties, from which the club or faculty adviser made a selection? Or were books
automatically distributed at intervals throughout the year to all institutions?
I hope this will not place an undue burden on your staff-but since I cannot
foresee a time when a visit to your office might be possible I shall appreciate
very much your sending the information as soon as it is convenient .
With kindest regards, I am,
Sincerely yours,
KATHRYN CASEY,
Legal Analyst.
CARNEGIE ENDOWMENT FOR INTERNATIONAL PEACE,

OFFICE OF THE PRESIDENT,
NEW YORK, N . Y ., April 29, 1954 .
Miss KATHRYN CASEY,
131 Indiana Avenue NW, Washington, D . C.
DEAR MISS CASEY : I, too, regret that you, yourself, could not come to see us
.again. In any event, here is the information on the International Relations
Clubs which you requested in your letter of April 22 . For your convenience, the
numbers correspond to those of the questions asked in the letter .
1. The first student groups in colleges and universities for the serious study
and objective discussion of international affairs-known as international pol-
ity clubs-were organized in the autumn of 1914 under the direction of the
American Association for International Conciliation which, in turn derived
financial support from the Carnegie Endowment . In the fall of 1920 when di-
rection of the clubs was transferred to the Institute of International Education
(organized largely under the leadership of Dr . Nicholas Murray Butler with
=substantial financial support from the endowment), the name of the clubs was
the endowment in 1924, and the clubs were taken over by the endowment which
changed to international relations clubs . The institute became independent of
the endowment in 1924, and the clubs were taken over by the endowment which
continued actively in charge of them until the spring of 1951 . At this time
the Association of International Relations Clubs, established in 1948, assumed
supervision of the club program under a grant-in-aid from the endowment .
Although no longer actively directing the club work, the endowment maintained
a relationship with it through having a representative on the association's
executive board .
2 . The clubs were in no way a "development" from the international mind
alcoves, which were an entirely separate phase of the endowment's program .
At no time in the past have the clubs had any organizational connection with
the Foreign Policy Association, the Council on Foreign Relations, or any other
organization except those indicated under "1 ."


3. In 1938 there were 1,103 clubs as follows : 265 in high schools in the United
:States 685 in colleges and universities in continental United States ; 7 in the
Philippines ; 1 each in Hawaii, Alaska, Canal Zone, and Puerto Rico ; 24 in the
United Kingdom ; 34 in 14 Latin American countries ; 22 in China ; 9 in Japan ;
.2 in Korea ; and the remaining 51 in foreign countries including Canada, Egypt,
Greece, Iran, Iraq, Siam, New Zealand, Australia, South Africa, Syria, and India .
In January, 1948, the National Education Association in Washington assumed
leadership for the high school clubs . Information regarding them since then
may be obtained from the association.
In 1954 (April 26) there are 476 clubs in colleges and universities in con-
tinental United States ; 1 in Hawaii, and 28 in foreign countries including
Canada, the United Kingdom, Australia, New Zealand, South Africa, Egypt,
India, Japan, Pakistan, Philippine Islands, and Thailand, making a total of 505 .
4 . The materials sent to the International Relations clubs in high schools, col-
leges, and universities were a gift from the endowment, with the understanding
that they would be kept together as a special IRC collection, in the library or
elsewhere, readily accessible to the club members .
5. All clubs-large or small, in universities and junior and 4-year colleges, in
.the United States and foreign countries-received the same books in English
with the exception of some of the groups in Latin American countries which
were sent Spanish translations of some of the English publications or original
Spanish publications . Cooperation with the Latin American clubs was discon-
tinued during the academic year 1947-48 . Pamphlets and mimeographed mate-
rials, less specialized and better suited to the age level, were sent to the high
school clubs .
6. Although the endowment never had a field worker as such to stimulate
interest in the club movement, it maintained a competent "secretariat" in its
offices which carried on correspondence with the clubs, offering encouragement
to both club members and faculty advisers in carrying on the work, as well as
advice when sought, and suggestions for vitalizing club programs . It cooperated
closely with the host clubs in the 12-in 1948 increased to 14-regions through-
out the country where annual conferences were held, by helping to set up the
programs, furnishing speakers, and arranging for an endowment representative
to be in attendance at each conference . In the early 1930's letters were sent at
the beginning of the academic year to faculty members at a few selected insti-
tutions, informing them of the club work and its advantages . The clubs in-
creased to such an extent in number, however, that this procedure soon became
unnecessary . A great deal of the credit for this growth must be given to the
continued interest of students and faculty members alike, who, upon trans-
ferring to a campus without a club, proceeded to organize a new one or reactivate
a former one, and also to the establishment of clubs by students and/or faculty
people who were told about the work by enthusiastic members or advisers of
clubs on other campuses . On receiving an inquiry about the work, the endow-
ment furnished materials descriptive of the club program and suggestions for
organizing a club. The principal requirements for affiliation with the endow-
ment were that the group would meet regularly with a faculty adviser for the
study and discussion of world affairs from an unprejudiced and objective point
of view and that the books should be kept together as a permanent collection .
Upon notification that a club had completed its organization, it was placed upon
the mailing list to receive all club materials.
7. Two installments of books were automatically distributed to the clubs each
academic year . The books were initially selected by a member of the endow-
ment staff and then submitted for approval to a committee of which Dr . Butler
was chairman. In the first semester the books were sent to clubs which notified
the endowment that they were functioning and ready to receive them, and in
the second semester only to the clubs which had formally acknowledged receipt
of the first, or fall, installment . The distribution of books was discontinued
entirely in the spring of 1947 .
In this connection, you will be interested to know that the Association of
International Relations Clubs has just concluded its Seventh Annual Con-
ference . At the final business session on April 23, the association voted to
affiliate with the Foreign Policy Association, which is better equipped than the
endowment to aid them in planning their programs for objective study of inter-
national problems . At the same time the association passed a resolution thank-
ing the endowment for past services. It was with very real regret that the
endowment came to the end of a long chapter, in which we like to think that a
contribution was made to the better understanding of the responsibilities which

our country now bears as a world power .
Sincerely yours,
JOSEPH E . JOHNSON .
MEMORANDUM
JUNE 30, 1954.
Subject : Books distributed by Carnegie Endowment for International Peace .
Since it was impossible to check every volume distributed by the endowment
through the international mind alcoves or through the international relations
clubs and centers, a random sampling by year mentioned in the yearbooks was
taken . When Dr. Kenneth Colegrove was in Washington, D . C ., to attend the
hearings before the committee, he was asked to look over the books distributed
in the following years : 1918, 1926, 1928, 1931, 1932, 1933, 1938, 1939, 1941, 1943,
1944, 1947.
The authors and books for those years are given below . Those on which Dr.
Colegrove commented are in italics .
1918 Yearbook, page 86 ("distributed principally to college libraries and Inter-

national Polity Clubs")
C. R . Ashbee : American League To Enforce Peace
E . W. Clement : Constitutional Imperialism in Japan
Cosmos : The Basis of Durable Peace
Robert Goldsmith : A League To Enforce Peace
J. A. Hobson The New Protectionism
Roland Hugins : The Possible Peace
Harold J. Laski : Studies in the Problem of Sovereignty-"Opposed to the
`national interest'; inclines toward extreme left"
Ramsay Muir : Nationalism and Internationalism
Henry F . Munro, Ellery C . Stowell : International Cases
H . H . Powers : The Things Men Fight For
Bertrand Russell : Why Men Fight
Walter E. Weyl : American World Policies
1926 Yearbook, page 56 ("distributed principally to college libraries and

International Polity Clubs")
Carlton J . H. Hayes : A Political and Social History of Modern Europe
(2 vols .)
Prof. Schille Viallate : Economic Imperialism
George Matthew Dutcher : The Political Awakening of the East
Raymond Leslie Buel : International Relations"Globalist"
1931 Yearbook, page 67 :
Butler, Nicholas Murray : The Path to Peace
Eberlein, Marks, and Wallis : Down the Tiber and Up to Rome
Ellis, M . H. : Express to Hindustan
Keenleyside, Hugh L . : Canada and the United States
Larson, Frans August : Larson, Duke of Mongolia
Olden, Rudolf : Stresemann
Patrick, Mary Mills : Under Five Sultans
Phillips, Henry A. : Meet the Germans
Read, Elizabeth F. . International Law and International Relations-"Rather
leftist"
Redfield, Robert : Tepoztlan (Mexico)
de la Rue, Sidney : Land of the Pepper Bird (Liberia)
Russell, Phillips : Red Tiger (Mexico)
Ryhd, Hanna : Land of the Sun-God (Egypt)
Sassoon, Sir Philip : The Third Route
Sheng-Cheng : A Son of China
Street, C . J . C . : Thomas Masaryk of Czechoslovakia
Waldrom, Webb : Blue Glamor (the Mediterranean)


1932 Yearbook, pages 75, 80 :
Akeley, Delia J . : Jungle Portraits
Buck, Pearl S . : The Good Earth--"Slightly leftist"
Chase, Stuart : Mexico-"Mildly left"
Colum, Padraic : Cross Roads in Ireland
Forbes, Rosita : Conflict
Hindus, Maurice : Humanity Uprooted-"Marxian slant"
Ilin, M . : New Russia's Primer
McBride, Robert M. : Romantic Czechoslovakia
McMullen, Laura W.: Building the World Society-"Globalist"
Morton, H . V. : In Search of Scotland
Ross, Sir . E . Denison : The Persians
Strong, Anna Louise : The Road to the Grey Pamir--"Well Known Communist"
Van Dyke, John C. : In Egypt
Wagner, Ellasue : Korea
Wortham, N . E . : Mustapha Kemal of Turkey
Andrews, Fanny Fern : The Holy Land Under Mandate
Arendtz, Herman F. : The Way Out of Depression
Bratt, K . A. : That Next War?
de Madariga, Salvadore : Disarmament-"Ultra globalist and aimed at 8ub-
mergence of `national interest"
Harper, Samuel G . : Making Bolsheviks
Hudson, Manley 0 . : The World Court
I1in, U . : New Russia's Primer
League of Nations : Ten Years of World Cooperation
Lefebure, Victor : Scientific Disarmament
MacNair, Harley F . : China in Revolution
Mitchell, N . P. : Land Problems and Policies in the African Mandates of the
British Commonwealth
Moulton, H . G . : Japan : An Economic and Financial Appraisal

Angell, Norman : The Unseen Assassins-"Globalist"
Casey, Robert J . : Baghdad and Points East
Cohen-Portheim, Paul : England, the Unknown Isle
Desmond, Alice Curtis : Far Horizons -
Hedin, Sven : Across the Gobi Desert
Hudson, Manley 0 . : Progress in International Organization
Jones, Amy Heminway : An Amiable Adventure
Mackall, Lawton : Portugal for Two
Monson, Ronald A . : Across Africa on Foot
Morton, H . V. : In Search of Ireland, In Search of Wales
Patterson, Ernest Minor : America : World Leader or World Led?-"Globalist"
Phillips, Henry Albert : Meet the Japanese
Raiguel and Huff : This Is Russia
Thomas, Valentine : Young Europe
Tsurumi, Yusuke : The Mother
Angell, Sir Norman : The Unseen Assassins
Clark, Grover : Economic Rivalries in China
Cory, Ellen : Compulsory Arbitration
Escher, Franklin : Modern Foreign Exchange
Morley, Felix : The Society of Nations
Morse and MacNair : Far Eastern International Relations
Moulton and Pasvolsky : War Debts' and World Prosperity
Salter, Sir Arthur: Recovery, the Second Effort-"Globalist"
Patterson, Ernest Minor : America-World Leader or World Led?
Ware, Edith E .: Business and Politics in the Far East-"Doubtful"
1938 Yearbook, page 55 : "This material is directed in some instances only to the
trustees of the endowment, in other cases to a wider though limited circle of those
directly connected with the endowment and in still other cases to a comprehensive
list of those interested in 'international questions * * * Among the books so
distributed may be cited : * * *"
James T . Shotwell : On the Abyss-"Globalist"
William T. Stone and Clark M. Eichelberger : Peaceful Change-"Globalist
and leftist. Regarding W. T. Stone, see the report of the McCarran subcom+
mittee . Stone was closely associated with Edward Carter of I . P. R ."
928 TAX-EXEMPT FOtJNDATIONS
1938 Yearbook, page 62

Dulles, Allen W ., and Armstrong, Hamilton Fish : Can We be Neutral?
Dunn, Frederick Sherwood : Peaceful Change
Florinsky, Michael T . : Fascism and National Socialism
Horrabin, J. F. : An Atlas of the Empire
Lichtenberger, Henri : The Third Reich
Miller, Spencer, Jr. : What the I . L. O. Means to America
Peers, E . Allison : The Spanish Tragedy
Staley, Eugene : Raw Miterials in Peace and War
Salter, Sir Arthur : World Trade and Its Future-"Globaliat"
Vinacke, Harold M . : A History of the Far East in Modern Times
Willert, Sir Arthur and others : The Empire in the World

Angell, Norman : The Defense of the Empire
Angell, Norman : Peace with the Dictatoraf-"Globalist"
Butler, Nicholas Murray : The Family of Nations
Davies, E. C . : A Wayfarer in Estonia, Latvia, and Lithuania
Fergusson, Erna : Venezuela
Fry, Varian : War in China
Hamilton, Alexander, and others : The Federalist
Jackson, Joseph Henry : Notes on a Drum
Lewis, Elizabeth Foreman : Portraits from a Chinese Scroll
Loewenstein, Prince Hubertus Zu : Conquest of the Past
Lyons, Eugene : Assignment in Utopia
MacManus, Seumas : The Rocky Road to Dublin
Miller, M . S. and J. L. : Cruising the Mediterranean
Parmer, Charles B. : West Indian Odyssey
Roberts, Stephen H. : The House That Hitler Built
Sterne, Emma Gelders : European Summer
Streit, Clarence K. : Union Now-"Globalist and submersion of national inter-
est . Fallacious in his . analogy of Union of American States in 1781 with,
world federation"
Strode, Hudson : South by Thunderbird

Benes, Eduard : Democracy Today and Tomorrow
Bison, T. A . : American Policy in the Far East, 1931 19-"Pro-Communist"
Butler, Nicholas Murray : Why War?
Dulles, Allen W., and Armstrong, Hamilton Fish : Can America Stay Neutralf-
"Ultraglobalists"
Florinsky, Michael T . : Toward an Understanding of the U . S . S. R .
Ford, Guy Stanton (editor) : Dictatorship in the Modern World
Lippmann, Walter : Some Notes on War and Peace
Marriott, Sir John A . R. : Commonwealth or Anarchy?
Patterson, Ernest Minor : Economic Bases of Peace
Saerchinger, Cesar : The Way Out of War
Shotwell, James T, : What Germany Forgot
Viton, Albert : Great Britain, an Empire in Transition
1939 Yearbook, page 39 : "Among leftist speakers sent to conferences by the

Carnegie Endowment were Vera Micheles Dean and Dr . Eugene Staley. Mrs .
Dean and Max Lerner also were included in the 1941 list ."

Hunt, Dr. Erling (Teachers College) : Citizens for a New World, yearbook of
Commission for Orzanizat{on of Peace-r"Ultraglobalist"

Clark, Evans (editor) : Wartime Facts and Postwar Problems : A Study anar
Discussion Manual
Committee on Africa : Africa
Duffett, W . E ., Hicks, A . R. and Parkin, G . R. : India Today
Hambro, C . J . : How to Win the Peace

TAk-kkkMPr 'F0Uk,DATIO:WX' 929,

Hornbeck, Stanley K. : The United States and the Far East
Inman, Samuel Guy : Latin America : Its Place in World Life
Kohn, Hans : World Order in Historical Perspective
Maelver, R . M. : Toward an Abiding Peace-"Extremely globalist and careless
of the American `national interest"'
Mowat, R . B. and Slosson, Preston : History of the English-Speaking Peoples
Pares, Sir Bernard : Russia
peter, Nathaniel : A Basis for Peace in the Far East
Reves, Emery : A Democratic Manifesto
Stembridge, Jasper H ., An Atlas of the U. S . S . R .
Thomas, Elbert D.': Thomas Jefferson : World Citizen
Welles, Sumner : The world of the Four Freedoms
1944 Yearbook, page 52
Broderick, Alan H . : North Africa
Chiang Kai-shek, Generalissimo : All We Are and All We Have
Chiang Kai-shek, Madame : We Chinese Women
Follett, Helen : Islands on Guard
Gatti ; Allen and Attilio : Here is Africa
Goodell, Jane : They Sent Me to Iceland
Hambro, C . J . : How to Win the Peace
Henley, Constance Jordan : Grandmother Drives South
Hutchison, Bruce : The Unkonwn Country
Lanka, Herbert C . : Pan American Highway through South America
Lattimore, Owen : America and Asia-"Subtle propaganda along Communist
line. 'Lattimore cited' in McCarran subcommittee report as part of Commu-
nist cell in the Institute of Pacific Relations"
Maisel, Albert Q. : Africa : Facts and Forecasts
Massock, Richard G . : Italy from Within
Pares, Sir Bernard : Russia
Peffer, Nathaniel: Basis for Peace in the Far East-"Leftist. See McCarrann
subcommittee report"
Representatives of the United Nations : The People's Peace
Welles, Sumner : The World of the Four Freedoms

The Soviet Union Today, An Outline Study : American Russian Institute-
"Favorable to U. S . S . R."
The United Nations Economic and Social Council : Herman Finer.
America and the New World : The Merrick lectures, 1945.
Perpetual Peace : Immanuel Kant.
Political Handbook of the World, 1946 : Walter H. Mallory, editor.
Germany Is Our Problem : Henry Morgenthau, Jr.
The Atomic Age Opens : Editors of pocket books .
America's Stake in Britain's Future : George Soule.
Peoples Speaking to Peoples : Llewellyn White and Robert D . Leigh.
The United Nations in the Making : Basic Documents : World Peace Founda-
tion.
The Soviet Union Today : American Russian Institute
The Chrysanthemum and the Sword : Ruth Benedict.
The World Today : Nicholas Murray Butler.
Sun Yat-sen : Stephen Chen and Robert Payne .
Britain : Partner for Peace : Percy E. Corbett-"Extremely globalist"
The United Nations Economic and Social Council : Herman Finer .
Brazil : An Interpretation : Gilberto Freyre.
Greece : A . W. Gomme.
Our Son, Pablo : Alvin and Darley Gordon .
France, Short History : Albert Guerard.
Iran : William S . Haas .
And the Bravest of These : Katharine Roberts.
New Zealand : Philip L. Soljak .
Peace Atlas of Europe : Samuel van Valkenburg.
The Story of the Dutch East Indies : Bernard H. M. Vlekke.
The French Canadian Outlook : Mason Wade .
Originally it had been intended to have others in addition to Dr . Colegrove
make notations on these and other books distributed by the Carnegie Endowment

930 Tom: FOUNDATION
for International Peace, either through the International Mind Alcoves, the
international relations clubs and centers, or other means . However, up to this
time, it has not been possible to proceed with this particular project .
KATHRYN CASEY,
Legal Analyst.
EXHIBIT-PART II . ROCKEFELLER
EXCERPTS FROM ANNUAL REPORTS OF THE ROCKEFELLER FOUNDATION AND MATERIAT .

TAKEN FROM OTHER SOURCES FROM 1929 TO 1952
(Source : The Rockefeller Foundation, 1932 annual report, pp. 274-275

ECONOMIC PLANNING AND CONTROL
"Events of the past 3 years have made strikingly evident the tremendous
social losses occasioned by the ups and downs of modern business enterprise.
Much physical suffering, illness, mental disorder, family disintegration, crime,
and political and social instability trace their origin -to economic causes ., In a
time of depression, when enterprise is halted and millions of the unemployed are
unable to command the necessities of life, the question is insistently heard, Why
does this distressing situation arise in a country where raw materials exist in
plenty, where technological equipment is of the best, and where workers are
eager to apply their productive -capacities? The opportunity and need for
scientific attack on the problem of economic maladjustment are unmistable . The
foundation views this field as highly important and well adapted to research,
"For several years various studies and organizations concerned with economic
stabilization have been supported . .It is believed that a more complete knowl-
edge of the working of our present economic system-e. g ., of conditions as
revealed by realistic, statistical studies of unemployment ; the characteristics,
methods, and hazards of specified industrial enterprises ; the complex forces
operating in a competitive society in a number of specific situations-must sup-
ply the necessary basis for planning an effective economic . organization."
(Source : The Rockefeller Foundation, 7 .936 annual report, pp. 55-56 : )

"* * * As one reviews the history of the men and women who, over the last
20 years, have received fellowships from the foundation, the record appears
most gratifying . Today, they are occupying positions of importance and dis-
tinction in nearly every country of the'world . They are on university faculties ;
they are connected with research laboratories ; they hold strategic governmental
positions ; they are carrying on significant and productive work in wide fields
of knowledge. Some of them, indeed, have gained outstanding recognition, such
as the award of the Nobel prize . It would be idle to assume, of course, that
their leadership and their contribution to scientific thought are the results solely
of their fellowship experience . Doubtless, many of them' would .have gained
eminence without this experience, or would have obtained the experience in
other ways . But it is a satisfaction to record the subsequent success of highly
promising men and women, picked largely from the younger generation, to whom
the foundation is proud to have been of some assistance."
(Source : The Rockefeller Foundation, 1937 annual report, pp . 57-58 : )

THE DEBACLE, IN CHINA .
"Last year, in the Review, the following sentence ,appeared : `China today
stands on the threshold of a renaissance . The Chinese National Government, to-
gether with many provincial and county authorities and private organizations,
are attempting to make over a medieval society in terms of modern knowledge .'
"This proud ambition, in which the foundation was participating, has been
virtually destroyed by the events,, of .the last 6 months . The program was
primarily a program of rural reconstruction and public health ., . It was rooted
in promising Chinese institutions like Nankai University in Tientsin, and the
National Central University and the National Agricultural Research Bureau, both
in Nanking . It was promoting studies in subjects like animal husbandry and
agriculture ; it was carrying on broadly based field experimentations ; and it was
training men and women for administrative posts in rural and public health
work.
"Nankai University was completely destroyed last July . The universities and
institutions in Nanking, where they are not too badly damaged, are serving today
as army barracks. The field units in mass education and public health are so
completely scattered that it is practically impossible to locate them . The work,
the devotion, the resources, the strategic plans of Chinese leaders for a better
China, have disappeared in an almost unprecedented cataclysm of violence .
"At the moment there is nothing further to report . The foundation still main-
tains its office in Shanghai . Whether there will be an opportunity to pick up
the pieces of this broken program at some later date, no one can foretell ."
(Source : The Rockefeller Foundation, 1940 annual report, pp . 273-277 :)

NATIONAL INSTITUTE OF PUBLIC AFFAIRS
"The foundation continued its support of the national institute's experimental
program of recruiting and training personnel for the Federal services by a grantt
of $105,000 for the 3-year period from October 1, 1941 . For the past 5 years,
the program has involved the annual placement of approximately 50 graduate
students preparing for public service careers, in agencies of the Federal Govern-
ment for a year of practical apprenticeship . The institute also serves as a clear-
inghouse of information and as a liaison agency in matters relating to this re-
cruitment and training program . Sixty percent of its "internes" are now in the
Federal service ; several are in State and local or other government services, and
a number are continuing graduate study .
"The institute hopes to continue its program directed toward developing a-
more effective means of recruitment of persons for Government service, espe-
cially for its influence in improving the relations between the Federal authorities
and the educational institutions of the country."
(Source : The Rockefeller Foundation, 1941 annual report .)

Pages 230-231
INSTITUTIONAL GRANTS
"Council on Foreign Relations
"Each study group consists of specialists in designated areas in the various
problems to be dealt with . The program permits the continuous examination of
events related to problems of special interests of this country, and the assembly
and interpretation of research material . Each group works under the leadership .
of a rapporteur . A steering committee composed of the rapporteurs and the
leading officers of the council is responsible for the general planning, the coordina-
tion of the activities of the groups, and the interchange of material and points of
view.
"More than 250 memoranda on special subjects had been prepared before the
end of 1941 . These had been furnished to the Government services charged
with handling the various questions discussed . Many representatives of these
services had also participated in the discussion of the study groups ."
"Foreign Policy Association
"The former project is concerned primarily with the organization of educational
work in relation to world problems, collaboration with colleges, schools, forums,
women's clubs, youth groups, labor programs, agricultural clubs, etc . Its purpose
is the preparation and distribution of educational material in the field of inter-
national affairs and the encouragement of discussion of such material . A special
series of `Headline Books,' published since 1935, is one aspect of the publication
program . At least 15 titles have been added to the list over the past 3 years .
Study materials which supplement these books are used by various groups
throughout the country . Several of the `Headline Books' have been translated
into Spanish and distrbuted in South America .
"It is hoped to establish effective bases of cooperation with leading national
organizations serving the cause of public education in the United States, and
with Government agencies actively concerned with increasing general knowledge
and understanding of problems of American foreign policy .
"In view of the current world situation, the Foreign Policy Association will
concentrate its research during the coming year in three main fields : (1) Devel-
opments in the occupied countries of Europe ; (2) political and economic trends
in Latin America ; and (3) problems of postwar reconstruction .
54610-54-5
"In addition to its research activities, the association furnishes speakers to

educational public policy organizations, arranges luncheon - discussions, and
conducts a series of broadcasts now distributed through 70 stations . Its Wash-
ington bureau collects firsthand information on current issues of American foreign
policy . The association also maintain a Latin American Information Service,
which published until the end of 1941 its biweekly Pan American News, furnish-
ing background material on political and economic trends in Latin American
countries."
Pages 233-234
INSTITUTE of INTERNATIONAL STUDIES
"Yale University
"The institute, founded in 1935, had the following objectives : To promote basic
research in international relations with particular attention to studies designed
to clarify American foreign policy ; to develop a broad and well-rounded program
of education and training in international relations on both the undergraduate
and graduate level ; to evolve procedures of coordination and integration among
the various social sciences in the analysis of international problems ; and to aid
in the postdoctoral training of younger scholars in the general field of inter-
national relations .
"The research program of the institute included many projects centering around
problems of American foreign policy, but designed also to interpret the role of
power in international affairs, and the relation of national policies to military
policies and principles of grand strategy .
"Four major studies have been published and several others are nearing com-
pletion . Certain of the projects are being carried on in conjunction with Govern-
ment departments . Among the specific subjects proposed for study are : Prob-
lems of national defense ; United States and the future order of Europe ; hemi-
spheric unity ; the geographic basis of foreign policy ; and inter-American trade
relations.
"The program of education has been closely coordinated with the research
program . The projected program for the next few years will not represent any
substantial change in policy . A combined social science approach will stress
analytical rather than historical methods ."
(Source : The Rockefeller Foundation, annual report for 1942 .)

Pages 179-180 :
THE SOCIAL SCIENCES
"Social Science Re8earoh Council
"Washington personnel office . Even before the United States entered the war,
a vital need was felt in Washington for an agency to promote more effective
utilization of social scientists . In the stress of the prewar emergency the Na-
tional Government had recruited many thousands of persons trained in the social
sciences ; later, of course, the demand greatly increased .
"It was foreseen that unless the recruitment policies were integrated and wisely
administered severe shortages would result and skilled talent would be squan-
dered.
"After a careful study of the problem the Social Science Research Council set up
an office in Washington to work in cooperation with Government agencies on
three tasks : (1) Consulting with Government agencies on policies and methods
of recruitment ; (2) advising with individuals who wished to contribute their
talents where they could be utilized most effectively ; and (3) consulting with
university officals regarding the temporary release of members of their faculties.
"The Council already had joined with other national scientific councils in
promoting the roster of scientific and specialized personnel, but responsible offi-
cials felt that this was not enough . Now, the office which has been set up in
Washington provides a place to which persons may turn for extragovernmental
advice concerning social science problems. Similar services had earlier been
provided for engineers and specialists in the various field of medical and natural
sciences."
Pages 1181-182
"Public Administration Committee
"The agencies through which society will seek to meet its diverse problems are
multiform, and total effort, whether for defense or for the postwar world, will
receive its primary direction through the agency of Government. For the past 7
years the foundation has supported the activities of the public administration
committee, whose original objectives were to capture and record and lay the basis
for the appraisal of measures initiated in the United States for grappling with the
consequences of the worldwide social and technological changes that were taking
place . The end objective was, if possible, to add to the store of principles of
administration so that administrators who must make decisions might profit by
recent and current experience .
"The committee formulated a series of major studies of two general types :
(1) Administrative problems of new and emerging governmental activities ;
and (2) appraisal and review of significant developments in administration of
the last 3 decades .
"More recently the committee has focused its resources and attention mainly
on planning and stimulating rather than on executing research . A broadening of
the program to include the field of government, with public administration
as one sector is now contemplated . Such a program would deal less with the
mechanics of administration than with the development of sound bases of policy
determination and more effective relationships in the expanding governmental
structure."
(Source : The Rockefeller Foundation, 1943 annual report, pp . 17&-179 :)

INTERNATIONAL STUDIES
"The war and peace studies project of the council was organized shortly
after the outbreak of hostilities in 1939 for the purpose of furnishing such
scholarly contributions to the work of the Government as an unofficial agency
can make in wartime. Studies have centered around five main fields : strategy
and armaments, economics and finance, political questions, territorial ques-
tions, and the peace aims of European nations . Since the inception of the
project 541 memoranda have been sent to Washington dealing with subjects
selected by both the council and the Government . The research is carried
on by the study group method and the membership of these groups includes
persons • especially qualified by training and experience, both in Government
service and out, as well as members of the council's research staff . The founda-
tion has appropriated $60,800 for the continuation of these studies in 19,44. The
interest which has been shown in these studies has led the council to arrange
during the coming year for a wider distribution of various memoranda based
on some of them, both inside the Government and to selected individuals in
private organizations."
Pages 186-187 : "The grants in international relations were for the support
of agencies devoted to studies, to teaching, to service to Government and to pub-
lic and expert education . 'Collectively these grants assume that it is not possible
to guarantee peace but that the way to work toward it is to strengthen `the
infinity of threads that bind peace together .' To that end the foundation made
grants for the support of studies and related activities of the following institu-
tions : Foreign Policy Association, Royal Institute of International Affairs
(London), Swedish Institute of International Affairs (Stockholm), and the
economic, financial, and transit department of the League of Nations. The im-
portance to peace of our relations with, and an understanding of, Russia was
reflected in two grants to Columbia University for the Russian institute of its
School of International Affairs . The sum of $60,000 was appropriated to the
Council on Foreign Relations for the continuation of its war and peace studies.
A special grant of $152,000 was made to the Royal Institute of International
Affairs for a history of the war and the peace settlement . The Institute for
Advanced Study at Princeton received $40,000 for a study of the problems of in-
ternational civil aviation . Fifteen thousand dollars was granted to the Massa-
chusetts Institute of Technology to aid in the development of a course in inter-
national relations for engineers."
(Source : The Rockefeller Foundation, 1945 annual report, pp. 188-189 :)

"Columbia University School of International Affairs, Russian institute
"Increased efficiency and rapidity of transportation and communication have
ended for this country the possibility of isolation, either as a physical fact or as a
national policy . Those responsible for the management of the interests of the
United States, whether in governmental of nongovernmental capacities, will of
necessity be increasingly concerned with the institutions, mores and policies
of other nations and peoples . There must therefore be developed with the
United States a body of men and women with a broad understanding, of inter-
national affairs who have in addition training as functional or regional special-
ists . Only a body of men and women so trained will provide a reservoir from
which experts capable of handling the increasingly complex and intricate prob-
lems of international affairs can be drawn .
"For some time Columbia University has been exploring the desirability of
establishing at the university a school of international affairs . The recom-
mendation that such a school be created was made in 1945 and included the
proposal for establishment of six institutes designed to develop special knowl-
edge and understanding of certain of the so-called power and problem areas of -
the world . It is planned to assemble in these institutes groups of outstanding
scholars who have specialized in specific geographical areas. The university
suggests that a British Commonwealth institute, a French institute, a German
institute, a Russian institute, an East Asian institute, and an institute of Latin
American affairs be created . The Rockefeller Foundation has made a 5-year-
grant of $250,000 to Columbia University toward the development of a Russian
institute."
(Source : The Rockefeller Foundation, 1945 annual report, p . 199 :)

UNITED NATIONS INFORMATION OFFICE, NEW YORK
"One of the elements vital to the future success of world cooperation is the
immediate accessibility of the huge documentation of the United Nations confer-
ence in San Francisco, which, by an almost unprecedented action of the confer-
ence, was made available for prompt public examination and study. With respect
to many crucial issues the really significant material is not the formal language-
of the articles of the Charter, but the interpretation contained in the reports
and discussions of the various committees . The conference, however, 'had no
means of publishing this material . The secretariat which staffed the conference
ceased to •exist at the closing of the conference. The new secretariat is dealing
with the future rather than with the past . The United Nations Information+
Office, therefore, with the consent of the authorities of the conference, is publish-
ing the official document of the conference in cooperation with the Library of'
Congress ."
(Source : The Rockefeller Foundation, 1946 annual report :)

Pages 8-9 : "The challenge of the future is to make . this world one world-a:
world truly free to engage in common and constructive intellectual efforts that
will serve the welfare of mankind everywh ere."
• • •
Pages 32-33 : "International relations :
"The grants in this field went to agencies which conduct research and education
designed to strengthen the foundations for a more enlightened public opinion and ,
more consistent public policies . * * *"
" * * * This parallels the grant of $152,000 made in 1945 to the Royal Institute
to enable Arnold Toynbee to write a history of international relations from 1939
to 1949. An appropriation of $300,000 was made to the food research institute
of Stanford University for the preparation, in collaboration with experts from
many countries, of a history and appraisal of the world's experience in handling'
food and agriculture during World War II . Another grant was for the purpose
of assisting the United Nations information office to reproduce the documentation
of the first General Assembly and Preparatory Commission of the United Nations .
The Brookings Institution was given a fund which will enable Dr . Leo Pasvolsky,
who was special assistant to the Secretary of State for International Organiza-
tion and Security Affairs, to analyze the background of the development of the


United Nations organization and to initiate studies and educational conferences
on the problems that are emerging in the functioning of our new international
machinery.
t s s s $ s s
Page 40 : "In this connection, mention might be made of the appropriations,
voted in 1946, through the foundation's division of the social sciences, of
$233,000 to the Institute of Pacific Relations, $60,000 of which went to the
American Council and $173,000 to the Pacific Council . Much of the work of
this organization is related to the training of personnel, the stimulation of lan-
guage study and the conduct of research on problems of the Far East . It is part
of the pattern by which, from many different directions and points of view,
-efforts are being made to bring the West and the East into closer understanding ."
Pages 182-183 :
"The Brookings Institution
"The developing foreign policies of the United States as one of the major
powers sharing world leadership are to be appraised under the new international-
relations program of the Brookings Institution . Each of the studies is an integral
part of a research plan geared to those international-relations problems with
which the United States either is, or will be, concerned . This problem approach is
intended to aid in formulating enlightened public opinion in training specialists
in international affairs, and in aiding governmental agencies dealing with foreign
relations. An annual seminar will endeavor to train specialists and aid teachers
of international relations . A 1-year grant of $75,000 was made by the foundation
in support of this program .
"Two annual surveys will be published. One of these will examine American
foreign policies, but with particular attention to the problems directly ahead
and to the factors likely to determine their solution. The second survey will
consider the foreign policies of other nations, especially the major powers, and
bow these are being harmonized through the United Nations and its related
agencies .
"Five major studies are in progress : The United Nations Charter and its effect
on the powers, duties, and functions of the U . N. ; the foreign policy objectives of
the five major powers ; the general effectiveness of international organizations
and conferences as methods of diplomacy ; present-day factors making for eco-
nomic war or for economic peace in international relations ; and changes in
international security concepts resulting from technological and strategic
developments.
"Dr . Leo Pasvolsky, who has been in Government service since 1934, has now
returned to the Brookings Institution as director of these studies ."
Pages 190-191
"Institute of Pacific Relations
"The Institute of Pacific Relations, an unofficial international organization
with a number of constituent national bodies or councils, aims to increase knowl-
edge of economic, social, cultural, and political problems of the Pacific area .
Training personnel, stimulating language teaching as well as curriculum attention
to the Far East in general, and publishing research studies, are the institute's
chief means of spreading knowledge . The distribution of educational materials
to secondary schools and to the Armed Forces increased significantly during the
past several years ."
Pages 192-193 :
United Nations Information Once, New York
"The importance of preventing possible serious misinterpretations of actions
of international bodies due to unavailability of actual documents on transactions
was recognized when the foundation early in 1946 appropriated $16,177 to the
United Nations Information Office, New York, toward the cost of reproducing
the documentation of the Preparatory Commission in London and of the sessions
of the First General Assembly of the United Nations Organization . Preparatory
Commission documents were microfilmed in London and the film flown daily from
the Interim Organization to the United Nations office in New York and repro-
duced here by photo-offset within 24 hours of their arrival . Fifty or sixty copies
were sent to the Department of State and to key libraries throughout the country .

One thousand other copies were distributed to interested libraries, institutions,

and societies, and an additional number provided for editorial writers, news
commentators, and others . This appropriation was an emergency measure to
permit the reproduction of these documents and their distribution as promptly
as possible ."
(Source : The Rockefeller Foundation, 1947 annual report, pp . 39-41, 4" :)

APPROACHES TO PEACE
"Work which looks toward more adequate analysis and understanding of the
issues in international relations continued to hold an important place in the
grants made by the Rockefeller Foundation in 1947 in the field of the social
sciences ."
• * * * * *
"Meanwhile we cannot neglect the direct approach to the overwhelming crisis
of our generation, and for its part the foundation has contributed substantial
sums over the last decade to organizations and projects that are concerned with
the issues of international relations . This policy was, of course, continued in
1947 . For. example, the sum of $225,000 was given to Brookings Institution in
support of its broad program of research and education in the field of foreign
policy . This program, under the leadership of Dr . Leo Pasvolsky, involves,
among other objectives, five basic studies
"(1) Origin and Interpretation of the United Nations Charter.
"(2) Foreign Policy Objectives of the Major Powers.
"(3) Influences Making for Economic War or Economic Peace in International
Relations .
"(4) New Concepts of International Security .
"(5) International Organizations and Conferences as New Methods of
Diplomacy.
"In addition, Brookings Institution, as part of its program in the training of
specialists, has planned an annual 2-week seminar for about 100 teachers of inter-
national relations.
• •
"Still another appropriation-in the amount of $75,000-was given for t he
creation of senior fellowships at the Russian institute of the School of Inter-
national Affairs at Columbia University . The Russian institute, toward whose
creation in 1945 the foundation contributed $250,000, is without doubt the leading
graduate school in the United States in the field of Russian studies . In addition
to the Russian language, its basic curriculum provides : (1) A broad background
and training in 5 disciplines (history, economy, law and government, international
relations, and the social and ideological aspects of literature) as applied to
Russia ; (2) an intensive research training in one of these 5 disciplines elected
by the student ; and (3) fundamental graduate training in the broader aspects
of this elected discipline.
"The senior fellowships will make it possible to bring to the institute for ad-
vanced training some of those persons who are now conducting instruction in
Russian subjects in other universities, thus enabling them to broaden their
equipment and develop their effectiveness in Russian research .
"Other grants by the foundation in 1947 in this general field of international
relations include the following :
"(1) The Royal Institute of International Affairs ($50,625)-a supplement
to an earlier grant toward Prof . Arnold J . Toynbee's study of the history of the
war and of the peace settlement.
"(2) Commission of the Churches on International Affairs ($15,000)-for
preparations for conferences on the role of churches in international relations.
"(3) Johns Hopkins University ($37,400) -for a study of the trends and forces
which affect the United States in its international relations.
"(4) Netherlands Institute of International Affairs ($25,000)-for a broadly
based European conference on the economic and cultural aspects of the German
problem .
"(5) Council on Foreign Relations ($60 ,000)-:for general support.
• •


THE HUMANITIES IN SPACE
f • i t t
"The range and variety of grants of this type made during 1947 may be
briefly indicated . The American Council of Learned Societies received $12,000
for the work of its committee on Near Eastern studies, $25,000 for the trans-
lation into English of important Russian works, and $100,000 to augment the
supply of materials needed' for teaching and research on Slavic studies ; the
University of Pennsylvania, $60,000 for the development of studies of modern
India ; the University of Washington, $150,000 for studies of the Far East ; Yale
University, $25,000 toward the support of a group of advanced students of the
Far East ; the University of California, $30,000 to develop intensive instruction
in Slavic and Far Eastern languages, and $100,000 for the development of junior
personnel in Slavic studies ; Columbia University, $25,000, likewise for Slavic
studies ; Indiana University, $27,500 for the development of studies of Eastern
Europe, principally Finland and Hungary ."
Pages 189-190 :
THE FUNCTIONING OF AMERICAN POLITICAL DEMOCRACY
"Pacific Coast Board of Inter-Governmental Relations
"The foundation gave its support in 1947 to a pioneering educational experi-
ment in integrovernmental relationships at the working level. On the Pacific
coast the Governors of Washington, Oregon, and California, the chairman of the
3 State Leagues of Cities and State Associations of County Commissioners, and
the coast regional chiefs of 11 Federal agencies, have created a Board of Inter-
governmental Relations. The board aims to improve and coordinate government
through meetings for the discussion of common problems, and, acts as a nonprofit
association solely to inform its individual members, and throuh them the public,
of general and current problems . It takes no action, directly or indirectly, which
might be construed as carrying on propaganda, or otherwise attempting to influ-
ence legislation .
"Thus far every meeting has had virtually full attendance, from the three
Governors down . Typical subjects discussed to date include Federal-State-local
tax and fiscal relationships ; division of welfare costs ; forest development, con-
servation, and protection ; educational programs for veterans and nonveterans ;
problems of minorities in metropolitan centers ; employment and unemployment, .
public-works planning and timing ; adequate housing programs ; industrial re-
conversion ; availability of materials ; and surplus property disposal ."
r s s s 4 * s
Pages 190-191 :
"National Institute of Public Affairs
"The National Institute of Public Affairs recruits from the immediate gradu-
ates of the colleges and universities in the country talent for administrative and
management posts in the Government of the United States and other jurisdic-
tions . Sponsored by a board of public-minded citizens and acting as a liaison unit
between the colleges and universities and the Federal departments, it has com-
pleted the 12th year of its unique public service training program, under which 30
to 50 college graduates each year have been selected and given rotating assign-
ments on a nonsalaried basis within Federal agencies . The institute provides in-
tensive orientation, supervision, and a carefully planned program of reading, .
studies, and conferences with public officials.
"The foundation has supported this program since 1935 . Maintenance for
about half the interns is financed by funds or followships raised by various col-
leges or their alumni . Encouraging is the competition and career interest which
the program stimulates on college campuses throughout the country ; also the .
rapidity with which graduates of the institute have risen to positions of responsi-
bility in public life .
"A natural complementary development, guided by the institute in its first
stages is a parallel inservice training program, for selected personnel of some .
15 Federal departments or agencies, which is now in its seventh 6-month session_
under a coordinator furnished by the Civil Service Commission. The departments
of State, War, Navy, Commerce, and Agriculture, are supplementing this with-
coordinated programs of their own."
i t • • i

938 'TAX-EXEMPT FOUNDATIONS
INTERNATIONAL RELATIONS
Page 204-205 : "There is an urgent and ever-increasing need in this country
for basic information on the economic and political structure of the world and
on the trends and forces which prevail and collide in various parts of the world
and which affect the United States in its international relations . It is not
,enough to point out these trends and forces ; it is essential to measure and
weigh them.
"At Johns Hopkins University, Dr. W . S. Woytinsky has undertaken a piece
of work which should help to answer this demand by giving an inclusive sta-
tistical picture of the different patterns of life of all nations of the globe and
of the conditions in which they are facing the future . It will provide at least
a partial background for discussion of such problems as the future of various
races and continents ; the fate of colonial empires ; relations between industrial
and agricultural nations ; growth or decline of foreign trade ; competition of
raw materials, sources of energy, and means of transportation within the world
economy ; and conditions of world prosperity and peace . The work goes beyond
the simple source book of statistics of international interest, in that these sta-
tistics are selected and organized with reference to specific problems of inter-
national importance . The resulting volume, America in the Changing World,
should be valuable in promoting a better understanding of statistics, not as a
mathematical discipline but as quantitative thinking on human affairs . The
Rockefeller Foundation is supporting this project with a 3-year appropriation
of $37,400."
• * * * * * *
Page 205 :
• * * * * * *
"The role of conflicting ideologies in foreign affairs is under discussion in
-a study group which the council has recently initiated on public opinion and
foreign policy . The central problem of the group concerns the proper func-
tion of propaganda in the conduct of foreign affairs . Progress has been
made on another study, the problem of Germany, which is financed by a spe-
cial grant from the Rockefeller Foundation . The Netherlands Institute of
International Affairs invited the Council on Foreign Relations to participate
in this study, which is being undertaken on an international basis ."

FOUNDATION POLICIES
Pages 8-9 :
• • • •
"In general the policy of the founda tion and, w ith occasional exceptions,
its practice have conformed to the following principles : (1) The support of
the foundation should be directed to purposes for which it is otherwise diffi-
cult to secure funds ; (2) the support should be of an initial or catalytic char-
acter, with the idea that what has been demonstrated to be useful should then
be carried on by other means ; (3) current and palliative types of philanthropy
should accordingly be left to others, not because they are unimportant, but be-
cause the needs they encompass are more generally recognized . Furthermore,
the resources of this foundation, and indeed of all similar foundations com-
bined, are insignificant in relation to such needs."
• •
Page 243
"Columbia University Far Eastern Studies
"Without question east Asia will remain for a long time .to come one of the
great problem areas of the world . The United States has need of specialists
who possess at once high technical competence in the social sciences and a
knowledge of the languages and cultures of the area . Looking toward the
,establishment of a research institute in the east Asian field, the school of
international affairs at Columbia University has started a program of Far
Eastern studies through the various social-science departments . Owing to
recent expansion in the fields of Chinese and Japanees languages, literature, and
history, Columbia has a firm foundation for these studies . The aim at present


is to promote a similar expansion . in the social sciences, in order to provide
advanced training' in economics, political science, and social analysis as related
to China and Japan. * * *"
•
Pages 247-248 :
"United Nations Economic Commission for Europe-Training Scholarships
"The United Nations Economic Commission for Europe has received a grant
of $12,000 from the Rockefeller Foundation to provide social-science scholarships
for selected European students.
• * * * * *
"An operational body which deals with virtually all aspects of European
recovery and development, the Commission has attracted to its staff an interna-
tional group of competent economists . These men can offer promising graduate
students an introduction to the international approach to economic problems
while they are acquiring first-hand knowledge of applied economics . The Re-
search and Planning Division, headed by Mr . Nicholas Balder, formerly of the
London School of Economics, carries on work which is closely linked with the
teehnlcal economic problems encountered in the operational activities of the
Commission . Dr. Gunnar Myrdal, of Sweden, Executive Secretary of the Com-
mission, has established a special committee to administer the program."

PRESIDENTS REVIEW
• * * * * * *
Page 5-7 : "The deeply disturbed political situation now prevailing in a large
part of the world has had the effect of considerably curtailing the worldwide and
international scope of foundation programs . Profound political changes have
prevented the foundation from operating in several countries in which it was
formerly active. These countries include Poland, Czechoslovakia, Hungary, and
China. During the past year the far-eastern office of the international health
division of the Rockefeller Foundation was moved from Shanghai to Macao and
then to Bangalore, India . All personnel were withdrawn from China, and a
malaria project under way in the island of Formosa was transferred to Govern-
ment auspices.
"Monetarily speaking, this is an age of huge financial operations . In the United
States large funds, chiefly governmental, are available even in the relatively
restricted field of research and fellowships. This has brought about a sharp
awareness of the discrepancy between the resources of any privately endowed
philanthropic organization, such as the Rockefeller Foundation, and the magni-
tude of funds needed today for large-scale research or educational enterprises.
"Until recently the Rockefeller Foundation was a principal source of funds for
foreign student fellowships at the advanced level . Today, as shown by the
United Nations educational, scientific, and cultural organization handbook of
available fellowships, Study Abroad, appointments made annually by the founda-
tion constitute hardly 2 percent of the 15,070 comparable awards now offered,
62.5 percent of them by Government agencies . It has been calculated that in
1913, when there were about 900 institutions of higher education in the United
States, the appropriations of the General Education Board and of the Carnegie
Corp., the 2 principal foundations at that time, represented more than 15 percent
of the current income of all higher educational institutions . In other words,
these philanthropic resources were fairly large in relation to the activities with
which they were concerned, and they were not unsubstantial even with reference
to public primary and secondary education .
"As things stand now, the income of the Rockefeller Foundation, the General
Education Board, and the Carnegie Corp. covers less than 1 percent of the
budgetary needs of the 1,800 institutions now ministering to higher education .
Indeed, the annual expenditures of all foundations, even though roughly $100
million, are insignificant in relation to public and private funds now needed and
now available for education, scientific research, and scholarly activities .
"In the light of these changed conditions I propose to devote part of this review
to a brief discussion of Rockefeller Foundation techniques in giving and in
cooperating with other agencies and other countries . It is hoped that some
light may be shed on the comparatively modest, yet significant, role that can

.still be played under present world conditions, by a privately endowed philan-

thropic organization."
s s s s s
Pages 253-254 :
INTERNATIONAL RELATIONS
"Council on Foreign Relations :
"The Rockefeller Foundation in 1949 appropriated $50,000 to the Council on
Foreign Relations, New York, for an organized study of problems of aid to Europe
in its broadest aspects . The European recovery program of the United States
.has a significance for our future prosperity and security so great as to challenge
the best efforts of private citizens as well as those in public office . The Economic
Cooperation Administration (ECA) believed that it would be of great value to the
,Government and to the public at large to have an appraisal of the European
situation by a group of competent private persons free from the pressure of day-
.to-day decisions and unhampered by governmental procedures or the considera-
tions of practical politics .
"Upon the invitation of the ECA, the council organized a group of leaders in
- the fields of economics, politics, and military strategy under the chairmanship of
-Gen . Dwight D. Eisenhower. At its monthly meetings this group has carefully
=examined the alms of American foreign policy with respect to Western Europe
.and has assessed the means-economic, political, and military-for achieving
those aims. Special attention has been given to the continuing interests of this
.country, as opposed to urgent expediencies of today and tomorrow, and to the
relation between current measures of policy and the attainment of long-term
_goals. Close liaison has been maintained with ECA and with other Federal agen-
cies and departments, but the group has functioned independently of the Govern-
ment .
"Conclusions will be presented in the form of memoranda to responsible Gov-
ernment officials . Nonrestricted information is to be released to the general pub-
lic by means of articles or pamphlets in order to help the public understand and
judge the measures which it will be asked to endorse and carry out . In addition,
it is hoped to issue a major publication or series of publications on the operations,
-effects, shortcomings, and interrelations of United States aid to Europe under
ECA and under the provisions of military lend-lease .
"To assist the group the council has provided a full-time research staff of
experts in the various fields of study, headed by Prof . Howard Ellis of the Uni-
versity of California . Under the guidance of the study commission the research
staff gathers facts and data for the discussion meetings and prepares memoranda
,on assigned topics. The council also furnishes library and clerical assistance .
'The study group is serving on a voluntary basis . The Rockefeller Foundation's
grant is to cover salaries and expenses of the research staff ."
"Institute of Pacific Relations
s • s a
Page 256-257 : "The eleventh conference will convene in 1950 in India and will
-discuss recent political and economic trends in the Far East and their conse-
-quences for the Western World . Preparation for the conference is a part of the
research program of the Pacific council, which is responsible for writing up the
-data papers which give the members of the conference the background informa-
tion they need for the discussions . Some of these papers, such as those on the
, Chinese Communist movement, nationalism, and communism in Burma, postwar
development of Indian capitalist enterprise, the development of political parties
-in Japan and the international effects of the withdrawal of western power from
.the Far East, are of wide interest. In order to enable the institute to strengthen
its conference and educational activities at a critical time in Far Eastern rela-
4tions, the foundation in 1949 made a supplementary grant of $25,000, available
until the end of March 1950 . Of this, approximately $14,000 is to augment the
research function of the Pacific council and $11,000 toward the expenses of 1950
conference."

'4 'Brookings Institution
* s s s s


Page 208-209 : "The 10 yearly issues, contain research on the immediate issues
to be faced by foreign policymakers . Additional publications put out under the
new program include a series of individual analyses on long-range problems .
Recent studies in this group have been on the International Trade' Organization
:as an instrument of American economic foreign policy, the United States and
peace settlements, and a history of the United Nations Charter . ' In order that
the values of this problem approach may be extended to Government leaders,
educators, and businessmen, the Brookings Institution now holds an annual
2-week . seminar on Problems of United States Foreign Policy . Seminars have
,already been held at Dartmouth College, Stanford University, Lake Forest Col-
lege, and the University of Denver, with over a hundred persons attending
each one ."
Pages 209-210 :
"Foreign Policy Association
"The Foreign Policy Association was created in 1918 for the purpose of carry-
ing on 'research and education activities to aid in the understanding and con-
structive development of American foreign policy .' As the role of the United
States has expanded in the international sphere, the association has undertaken
to explain this role and its implications to an ever-increasing number of Amer-
icans . Thirty-two branch organizations have been organized in large cities
throughout the country . Through the activities of these branches there have
been organized local and national conferences, and a widespread educational
program with frequent use made of radio and television . The three publications
of the Foreign Policy Association, available to the general public, schools, organ-
izations, and Government agencies, are a weekly foreign policy bulletin, which
covers current issues, the foreign policy reports, published twice monthly, which
discuss at some length pressing international issues and the popular Headline
Books, with details on problems of importance to Americans and to the world ."

Pages 68, 69, 70 :
THE INTERNATIONAL SCENE
"With the enigma of Russian intentions still the top problem in world politics,
the Russian institute of Columbia University's School of International Affairs
continues to be a key center for research and training in this field . Its 2-year
course, requiring familiarity with the Russian language and providing intensive
postgraduate instruction in the history, economics, law, politics, and culture
-of Russia, has in 5 years supplied the United States Army, the Department of
State, and other Government services with more than 100 trained men . Staff
members are frequently called on to lecture at the National War College, the
Air War College, and outside universities . Earlier grants for the institute,
which was established in 1946, totaled $362,000 ; and in 1950 the foundation
appropriated an additional $420,000 toward support over a 5-year period .
"A postwar development of the Brookings Institution is its international
studies group, organized in 1946 for research, education, and publication on
questions of American foreign policy. Directed by Dr . Leo Pasvolsky and
using a technique which is calls 'the problem method,' the group has held 10
seminars in various parts of the United States for university teachers, advanced
students, Government administrators, and journalists. To date some 800 uni-
versity professors have shared in foreign policy analysis through participation
in these seminars . Research activities are reflected in a number of books,
notably in the annual Major Problems of United States Foreign Policy, which
has been adopted as a textbook at West Point, Annapolis, and various universities
and colleges. A projected study which is now in the planning stage will analyze
the basic framework of international relations, including the fundamental con-
cepts and objectives of the major nations, patterns of economic behavior, polit-
ical attitudes in international relations, the channels and instrumentalities of
national action, and in general the whole pattern of internal and external factors
which condition the international scene . Since the international studies group
began 6 years ago, the foundation has appropriated $480,000 toward its program,
including $180,000 in 1950 ."
$ r s s s s

Pages 355-356 :
"United Nations Economic Commission for Europe
Long-run tendencies in the European economy
"In connection with its overall program on postwar recovery, the United
Nations Economic Commission for Europe (ECE) in 1949 asked Prof . Ingvar
Svennilson, the Swedish economist, to undertake a study of long-run trends in the
European economy . Professor Svennilson and a staff of assistants at Geneva
are now nearing the end of this work . It is essentially a survey of trends in the
European economy for the years 1913-50, with emphasis on population, indus-
trialization, manpower, and production, the influence of foreign trade on produc-
tion and the important factors contributing to economic growth in Europe .
"The Rockefeller Foundation appropriated $50,000 to the Economic Commis-
sion for Europe when Professor Svennilson began this work in 1949 ; in 1951 the
foundation made a 1-year grant of $23,725 for expenses in connection with the
completion of the survey . The United Nations intends to publish the findings ."
Page 359 :
"Public Administration Clearing House
Consultant for Japan .
"Throughout the period of allied occupation of Japan there has been an effort
to shift the emphasis of the Japanese governmental organization from a highly
centralized bureaucratic control system to a more widely diffused pattern, with
large areas of self-determination in local matters delegated to prefectures, cities,
towns, and villages .
"One group in Japan which is sponsoring the spread of this movement is the
recently organized Japan Public Administration Clearing House . All three levels
of local government are represented in this group, which is made up of delegates
from the Tokyo Bureau of Municipal Research and the national associations of
prefectural governors, prefectural assembly chairmen, municipal mayors, city
assembly chairmen, town and village mayors, and town and village assembly
chairmen.
"Assistance was offered to the new organization by the Public Administration
Clearing House of Chicago . With a grant of $10,740 from the Rockefeller
Foundation, the Chicago Public Administration Clearing House arranged to send
a consultant to Japan and to make its official resources available to the group
in Japan ."
* * * * *
(Source : The Story of the Rockefeller Foundation, by Raymond B . Fosdick :)

Pages 283-284 :
"As we have already seen in earlier chapters, the example of Rose and Pearce
in developing their programs on a worldwide basis was eagerly followed by the
other divisions of the foundation as they began their activities after the reorgan-
ization of 1928 . The details of many of these activities have already been con-
sidered ; in all cases they were motivated by the single phrase in the charter
`the well-being of mankind throughout the world' ; and they were predicated on
the conception that civilization and the intellectual life of men represent a co-
operative achievement, and that the experience of the race can be pooled for the
common good . It is an ironic circumstance that this objective should have had
to run the gauntlet of two world wars with their hideous aftermaths, when behind
closed frontiers, rigidly sealed off from contact with the ideas and opinions of
other nations, vast populations have suffered from mental undernourishment and
starvation . Intellectual malnutrition can be as stunting to human life and
character as the absence of calories and vitamins . The influences that in normal
times flow freely across boundary lines, the uninhibited stream of ideas coming
from all corners of the world, are, in this modern society of ours, a corrective
and stabilizing factor in the lives of men, bringing strength and fertility to soils
that would otherwise become sterile and dry. `Speech is civilization itself,' says
Thomas Mann . `The word, even the most contradictory word, preserve con-
tact-it is silence that isolates ."'
* * * *
Page 297 :
"A foundation with wide and intimate contacts can perform a useful function
in serving as an unofficial clearinghouse for ideas and plans in many fields .
Certainly this has been true of the Rockefeller Foundation . Its officers are in
continual touch with promising developments and personnel around the world.
The most effective projects it has supported have been developed in the field .
These projects have come from close acquaintance with scientists and lab-
oratories, from days and weeks spent on university campuses, from hard journeys
on horseback and riverboat to discover the breeding places of disease or the
prospects for a new type of corn. The officers thus develop a point of view that
is both cumulative and comparative .
"Consequently, the foundation has become a center to which research students
and universities turn for information ; and much of the time of the officers is
spent, not on questions of financial support, but in discussing with eager inquirers
the developments in their fields in other institutions and in other countries . As
the late President Keppel of the Carnegie Corp . said : `Much of what one uni-
versity learns about another is learned in foundation offices : "
Union Calendar No . 926

83d Congress, 2d Session - - House tteport No . 2681
REPORT
OF THE
SPECIAL COMMITTEE TO INVESTIGATE

TAX-EXEMPT FOUNDATIONS AND
COMPARABLE ORGANIZATIONS
EIGHTY-THIRD CONGRESS
SECOND SESSION
ON
H. Res. 217
DECEMBER 16, 1954 .-Committed to the Committee of the Whole House

on the State of the Union and ordered to be printed
UNITED STATES

SPECIAL COMMITTEE TO INVESTIGATE TAX-EXEMPT

FOUNDATIONS
B . CARROLL REECE, Tennessee, Chairman
RENE A . WoEMSER, General Counsel
ARNOLD KocH, Associate Counsel
THOMAS McNIECE, Assistant Research Director
KARL ETTINGER, was a Research Consultant
with the Committee from October 1953 to April
1, 1954
MILDRED Cox, Assistant Clerk, March 1, 1954,
to July 1, 1954, Acting Clerk, July 1, 1954, to
December 31, 1954
II
TABLE OF CONTENTS
PART ONE . INTRODUCTORY MATERIAL

Page
I . THE CREATION AND FUNCTIONING OF THE COMMITTEE 1
II . THE APPROACH . OF THE COMMITTEE 2
III . THE FOUNDATIONS AND TAXES 4
The Present Basis of Federal Interest 4
The Possibility of Wider Interest 5
How Foundations Are Created 5
What Induces the Creation of Foundations 5
The Ford Foundation : An Example of the Use of a Foundation _6
to Retain Management Control of an Enterprise
The Reid Foundation : Another Example of the Use of a Foun-
dation to Retain Management Control of an Enterprise _ _ _ _ 8
The Eugene and Agnes Meyer Foundation 10
Taxes and the Increasing Foundation Birth-Rate 11
Corporate-Created Foundations 12
IV . STATISTICAL MATERIAL 13
PART TWO . FINDINGS OF FACT AND

SUPPORTING MATERIAL
V . PREFATORY NOTES AND SUMMARY OF FINDINGS 15
Summary of Committee Findings 16
VI . THE POWER OF THE LARGE FOUNDATION 19
The Impact of Size 19
Public Accountability 21
Abdication of Trustees' Responsibility 22
The Social Sciences 30
Patronage and Control 33
The Foundation Bureaucrats 37
Criticism and Defense_-- 38
VII . THE CONCENTRATION OF POWER-THE INTERLOCKS 39
The Hazards to Society in an Interlock 39
Does a Concentration of Power Exist? 39
The Cartel and Its Operations 41
What Makes up the Interlock 45
The Social Science Research Council 47
The American Council on Education 52
Other Interlocks and Further Dangers 53
Politics-Power Flow-Planning 57
VIII . THE FOUNDATIONS AND RESEARCH IN THE SOCIAL SCIENCES 60
The Predominance of Empiricism 60
The "Fact-Finding Mania 62
Limitations and Dangers 66
Dr . Kinsey Counts Noses 67
More "Scientism" 72
Scientism and Causality 73
"The American Soldier 73
Some Results of Excessive Empiricism 75
Moral Relativity 76
Social Science Research in the Universities and Colleges 78
"The Social Sciences at Mid-Century 82
The Slant to the Left 85
"An American Dilemma 89
The Encyclopedia of the Social Sciences 91
"Experiment," "Risk Capital," and the Colleges 94

TABLE OF CONTENTS
PART TWO . FINDINGS OF FACT AND

SUPPORTING MATERIAL-Continued
Page
IX . THE POLITICAL ACTIVITIES OF FOUNDATIONS 95
The Quantitative Test 95
The Qualitative Test 96
The League for Industrial Democracy 96
Another Specific Instance of Clear Political Use : The American
Labor Education Service 106
The Twentieth Century Fund 109
The Fund for the Republic 110
Other"Civil Liberties" Projects 114
The Slant of the Concentration 116
A Carnegie Corporation Example 117
Another Example of Slant : The Citizenship Education Project_ 120
The General Problem 122
Social Engineering 123
The "Elite 126
The "Engineers," "Planning," and Socialism 129
The International Press Institute 133
The University of Chicago Roundtable Broadcasts-_ -- 133
Facts Forum 133
The Public Affairs Pamphlets 134
X . FOUNDATIONS AND EDUCATION 134
Carnegie and Rockefeller Reform the Colleges 134
The Carnegie Corporation Finances Socialism 137
"Social Engineering" and Education 142
The Foundation-Supported Collectivist Text-Books-The
Background___ - 146
The Rugg Textbooks 149
Dr . Counts and Others 151
The Building America Textbooks 154
The Moscow University Summer Session 157
The Ford Fund for the Advancement of Education 161
Inter-University Labor Education Committee 162
Good Books Discussion Groups ; Another Ford Fund for Adult
Education project 164
An Inevitable Conclusion 167
XI . "INTERNATIONALISM" AND THE EFFECT OF FOUNDATION POWER ON
FOREIGN POLICY 168
The New "Internationalism 168
The Interlock in "Internationalism 170
Carnegie's Money for Peace 170
The Endowment's "Mind Alcoves 173
A-Carnegie Endowment-Created International Relations Club_ 174
The Foreign Policy Association 175
The Council on Foreign Relations---
176
TheHistorical Blackout _ -- 178
The Institute of Pacific Relations 179
The Foundations, the State Department and Foreign Policy_- 181
The United Nations and UNESCO 182
Carnegie Endowment and the Bar Association 184
An International Social Science Research Council 185
Ford Enters the Field 186
American Friends Service Committee 186
Intercultural Publications, Inc 188
Globalistic Economics_ -- - 190
The National Education Association Goes "International"_ 191
Expenditures Abroad 194
The Basic, Foundation-Supported Propaganda re Foreign
Affairs 194
XII. COMMUNISM AND SUBVERSION 196
The. Communist Penetration 196
How Do They Do It? 198
The Extent of Subversive Grants 199
Subversives Fed to Government 200
The Basic Problem of Subversion 201
Foundations and Subversion 205
TABLE OF CONTENTS V
PART THREE . CONCLUDING OBSERVATIONS

Page
XIII . SOME SUPPLEMENTAL COMMENTS 207
The Problem of Foundation Survival 207
The Proposed Continued Inquiry 208
The Attitude of the Foundations 210
XIV. SPECIAL RECOMMENDATIONS NOT FULLY COVERED BY THE PREVIOUS
TEXT 212
The Jurisdiction of Ways and Means 212
Reform From Within the Foundations 212
Limitations on Operating Costs 212
"Collecting" Foundations 213
Waste in General 213
Defining Foundations 213
Internal Revenue Service Manpower 213
Full Public Access to Form 990A 214
A "Rule Against Perpetuities 214
Accumulations 214
Capital Gains 214
Restrictions on Corporate-Created Foundations 215
National Incorporation 215
Retroactive Loss of Exemption 215
Removal of Trustees 215
Public Directors 215
Revolving Directorates 216
Selection of Working Trustees 216
Relief for the Alert Citizen 216
Prohibited Abuses 216
Foundations Used To Control Enterprises 216
Area Exclusions and Restrictions 217
Type Exclusions 218
Protection Against Interlock 218
Greater Use of Colleges and Universities 219
The Excess of Empiricism 219
Political Use and Propaganda 219
Lobbying 220
Subversion 220
Foreign Use of Foundation Funds 220
Further Areas of Investigation 220
Statement of B . Carroll Reece, supplementary to the Report 223
Appendix to the Report - 227
Minority Views 417

Union Calendar No. 926

83D CONGRESS HOUSE OF REPRESENTATIVES REPORT
92d Session No . 2681
DECEMBER 16, 1954 .-Committed to the Committee .of the Whole House on the
State of the Union and ordered to be printed
Mr. REECE of Tennessee, from the Special Committee To Investigate

Tax-Exempt Foundations and Comparable Foundations, submitted
the following
REPORT
[Pursuant to H . Res . 217, 83d Cong ., 2d sess .]
vi'
PART ONE
INTRODUCTORY MATERIAL
I . THE CREATION AND FUNCTIONING OF THE COMMITTEE
This Committee was created by House Resolution 217, 83rd Con-
gress, first session, adopted July 27, 1953 . The resolution authorized
an investigation as follows :
The Committee is authorized and directed to conduct a full and complete
investigation and study of educational and philanthropic foundations and other
comparable organizations which are exempt from Federal income taxation to
determine if any foundations and organizations are using their resources for
purposes other than the purposes for which they were established, and especially
to determine which such foundations and organizations are using their resources
for un-American and subversive activities ; for political purposes ; propaganda, or
attempts to influence legislation .
The resolution directed a report to be filed by January 3, 1955 .
House Resolution 373, 83rd Congress, first session, adopted on
August 1, 1953, appropriated the sum of $50,000, with the expectation
of the Committee that further funds would be granted after the first
of the following year . Counsel was engaged as of September 1, 1953 ;
the building of a staff commenced about September 15, 1953 .
It was decided to engage in an intensive period of assembling and
study of material, after which public hearings were planned to be held
starting at the end of February or the beginning of March . After
the first of the year, an additional appropriation was requested in the
sum of $125,000 to carry the Committee through until January, 1955 .
After considerable delay, a sub-committee of the Committee on House
Administration decided to recommend the reduced sum of $100,000
as an additional appropriation ; later the full Committee on Adminis-
tration reduced this sum further to $65,000, which appropriation was
granted by House Resolution 433 on April 6, 1954 .
This additional appropriation was patently inadequate to enable
this Committee to do the work for which it had been created . More-
over, there were moments when considerable doubt existed whether
any additional appropriation would be granted . This doubt, the long
delay while its funds were being exhausted, and other harassments
to which the Committee and its employees were subjected, made it
impossible for the Committee to schedule any hearings until it had
funds at hand . The Easter recess then faced the Committee . Thus
the first hearing could not be scheduled until May 10, 1954 . Moreover,
radical revisions in the Committee's plans had to be made . It was
decided to hold such hearings as might be possible in May, June
and early July and then to report . It was obvious that the appropria-
tion which had finally been granted could not possibly support
continued studies for the remainder of the Committee's permitted
life .
A committee had been created by the previous Congress to investi-
gate the same field . We shall refer to it as the "Cox Committee ."
1

It had sent out questionnaires to about 1500 foundations, and about

two-thirds of the foundations solicited had filed answers to them.
The material in these answers was found to be of considerable value .
However, our staff was distressed to find that much of the data col-
lected and memoranda prepared by the previous staff were missing
from the files . (Hearings, p . 14, et seq .)
A request was made on November 16, 1953 for an executive order
to examine the forms known as 990A filed by foundations with the
Internal Revenue Service . This order was not granted until Febru-
ary 11, 1954, and actual access to these reports, containing much
valuable information which otherwise would have had to be obtained
by individual solicitation from the foundations or by subpoena, was
not granted by the Service until April 8, 1954 . When access was
finally obtained, the Committee was informed that it could not
photostat these reports nor borrow them from the Service . This, in
the light of their volume, limited their usefulness . Moreover, all the
forms requested had not been brought into Washington from field
offices .
Sixteen public hearings were held, the last on June 17th . Further
public hearings were discontinued by a resolution passed at an execu-
tive meeting of the Committee on July 1, 1954 . The Committee dis-
continued hearings with deep regret and only through necessity . It
understood that depriving foundation spokesmen of an opportunity
to state positions orally might affect its public relations ; it concluded,
nevertheless, that the circumstances permitted no other course .
Moreover, the 'discontinuance of the hearings resulted in no serious
loss to the inquiry, for oral testimony in an investigation of this nature
is of far less importance than research .
Nor did the foundations lose any opportunity either to present their
points of view or to receive attendant publicity . Written statements
were solicited from them, which gave them the opportunity to answer
the material already presented to the Committee and to add freely
such further comments as they might choose . These statements
were carefully considered and added in full to the record . The state-
ments were given full publicity and were widely reported in the news-
papers, appearing in a most favorable manner in view of the fact that
no critical comments by the Committee were simultaneously publi-
cized . The foundations touched by the hearings were thus given a
fair opportunity to put their best foot forward at the same time that
they escaped the embarrassment of cross examination .
The Committee's work by no means ended with the discontinuance
of public hearings . An investigation of this type is, after all, primarily
a matter of laborious research ; the research continued industriously,
hampered only by a gradual reduction in the staff which the Com-
mittee's limited finances necessitated .
In the following text we have used italics in conventional manner,
but also to designate foundations and tax-free organizations other
than universities, colleges, and schools, and to identify certain indi-
viduals, special reference to whose records is made in appendices .
II . THE APPROACH OF THE COMMITTEE
The Cox Committee admittedly had been allotted insufficient time
within which to do a complete study or even adequately to outline
the full scope of inquiry . The present committee deemed its mandate
to be virtually a continuation of the investigation of its predecessor .
It considered itself authorized to make a study not only of specific
abuses which might come to light but also of the general orientation
of foundations in our society . It has deemed itself, primarily a
fact-finding body, intending to make recommendations to the House
only where such seemed clearly wise. Principally, its function was
considered to be to bring into clear relief any grave criticisms which
appeared to be reasonably warranted in order that the House itself
could have a basis for considering whether further action should be
taken by way of additional study or the application of means of
correction or control .
The Committee was and is well aware of the many magnificent services
which foundations have rendered -to the people of the United States in
many fields and areas, particularly in medicine, public health and science .
Nothing has occurred to change its initial conviction that the foundation,
as an institution, is desirable and should be encouraged . If little time
is spent in this report reciting the good which the foundations have done,
it is not because this Committee is unaware of it or in any way reluctant
to acknowledge it . Rather, this Committee considers that it is necessarily
concerned with the evaluation of criticisms . A fair judgment of the
work and the position of foundations in our society must obviously take
into account the great measure of benefit for which they have been re-
sponsible . At the same time, the power of these foundations is so great
that a proper evaluation must give great weight to the dangers which have
appeared in their operations in certain areas of activity.
We wish, therefore, to make clear that not even an inferential con-
clusion is to be drawn from this report that foundations are undesir-
able . Our conclusion is the opposite . It is our intention to present
critical material for the very purpose of increasing the usefulness of
foundations and of making their place in our society firmer and safer .
We hope that such material will induce the foundations themselves
to "clean house," if that is necessary . This Committee is opposed
to any unnecessary government regulation ; and would recommend
Congressional action only in so far as the seriousness of certain
abuses might be accompanied by any unwillingness of the foundations
to reform themselves, or in the event that it were concluded that
certain dangers could be guarded against only through regulation .
It was our hope, to begin with, that no remedial action by the
Congress might be necessary . But foundations play a part in our
society the importance of which can hardly be exaggerated ; and, in
the course of our investigation, evidence of very grave abuses accumu-
lated to the point of indicating that intervention by Congress to pro-
tect our society is badly needed . Some remedies can be instituted at
once . Others should perhaps be considered only after that continued
and more intensive study of foundation activities which the facts
already disclosed have proved to be utterly necessary . Even with
an adequate appropriation, this Committee could probably not have
done the full study of the subject which the circumstances warrant.
It has been variously estimated that this would take a period of three
to seven years, by a full staff amply financed .
Our own studies soon disclosed the measure of this problem .
Accordingly, it was decided to limit the work by confining it to
"foundations" included under Section 501 (c) (3), [formerly Section
101 (6)] of the Internal Revenue Code ; and, within that category, to
eliminate (except where direct reference seemed necessary for other

reasons) consideration of (a) religious institutions, (b) operating
academic institutions and (c) certain other sub-divisions of the
501 (c) (3) [formerly 101 (6)] class, as well as (d) the small founda-
tions which are mere media for distributing the annual charitable
income tax deductions of individuals and (e) other minor distributing
or collecting foundations .
The term "foundation" is abroad one . In this report it is intended
to denote "foundations" as the term is ordinarily used by the lay-
man-indicating such foundations as The Rockefeller Foundation,
The Carnegie Endowment for International Peace, The Ford Foundation,
The Twentieth Century Fund, etc . We shall also, sometimes, include
certain types of organizations which are "foundations" within the
term but are not generally so recognized by the public . These are
the intermediary organizations, used by foundations, such as The
Social Science Research Council .
For reasons to be explained later, we decided, moreover, to confine
our inquiry chiefly to the activities of the foundations in what are
known as the "social sciences ."
This report is based upon the testimony at hearings ; the state-
ments filed by foundations and others ; the other material included
in the record ; data and information secured by personal conferences,
correspondence and telephone conferences ; and materials assembled
by a reading, study and analysis of books and literature relating to
foundations and to the social sciences .
III . THE FOUNDATIONS AND TAXES
THE PRESENT BASIS OF FEDERAL INTEREST .

With an occasional but rare exception, foundations are created under
state law. Their activities are, therefore, under state control, for the
most part . The Federal government acquires its immediate interest
through the tax laws . It has never sought directly to regulate founda-
tions, deeming this to be the province of the respective states in which
the foundations are created and operate . But the Federal government
extends to foundations certain exemptions from Federal taxation .
Their income is exempt from Federal income tax ; contributions to
them are free of gift tax and estate tax ; and the donor is permitted a
deduction for income tax purposes to the extent of 20% of the income
of an individual donor and 5% of that of a corporate donor .' These
exemptions are acts of grace by the Federal government . In so far
as they relieve foundations and their creators and supporters from
taxation, they impose a greater tax burden upon the generality of the
people of the country . Thus the Federal government permits the
equivalent of public money to be used by these foundations . Accord-
ingly, it is justified in applying certain restrictions on the right to the
various exemptions granted to foundations .
The theory behind such restrictions is simply that, as exemptions
are acts of grace, the government may clearly impose such conditions
on the exemptions as may be calculated to prevent abuse of the privi-
lege and to prevent the use of the exempted funds against the public
interest.
1 Under the 1954 amendments to the tax law an individual is granted a 30% 0 deduction for charitable dona-
tions but only 20% of this may go to foundations .
THE POSSIBILITY OF WIDER INTEREST .

Whether a Constitutional basis for a more extended Federal control
of foundation activities can be found, other than that which the tax
laws offer, is a matter which warrants careful study . The tax laws
can control foundations only in limited fashion . If greater control
becomes necessary or advisable, and a movement should come into
being in some degree to supplant or amplify the control now resting
with the states, a basis for legislative action might conceivably be
found in the general welfare clauses of the Constitution or elsewhere
in it ; but this would require a careful study of constitutional law .
The problem is not easy .
Many suggestions have been made in the "there ought to be a law"
area . This Committee repeats, however, that it does not favor any
unnecessary extension of Federal jurisdiction . It hopes that whatever
errors in foundation operation and management now exist may be
corrected within the Federal tax laws, by state law and by the willing-
ness of foundations to maintain more vigilant safeguards against
abuses which have existed in the past .
How FOUNDATIONS ARE CREATED .
They may be created by act of Congress, but few have been .
The usual methods are two : by the creation of a trust under state
law, having "charitable" purposes ; and by the creation of a corpo-
ration under the state law (generally what is known as a "membership
corporation") having exclusively "charitable" purposes . The trust is
managed by trustees who usually are authorized to fill their own ranks
as vacancies appear. The corporation is managed by a board of
trustees or directors, elected and replaced by the members . The
members are usually small in number and it is not uncommon for the
members to make themselves the directors .
WHAT INDUCES THE CREATION OF FOUNDATIONS .
Mr. Leo Eagan, in an article on foundations in the New York
Times of March 1, 1954, called attention to the "enormous growth
that.has taken place in the number and assets of foundations over the
last fifteen years .", saying later :
"All authorities agree that the number has risen rapidly since 1939 and is still
on the increase . It is likewise agreed that extremely high income and inheri-
tance taxes on big incomes and estates have been a major factor in promoting
this growth ."
A very common use of smaller foundations is as a means for dis-
tributing at leisure the charitable donations which are deductible
under the income tax law . This applies both to individual and
corporate donors . Instead of rushing at the end of the year to make
the necessary charitable payments to get within the full income tax
deduction allowance, one single contribution is made to a foundation,
which then may take its time to distribute the fund in detail . But
these contributions are not always distributed . Technically, they
constitute capital in the hands of the foundation, and not income .
As the tax law proscribes the unreasonable accumulation of income,
the distinction is important ; the foundation may aggregate the
donations received, paying out merely the income which this aggre-
gation earns and holding the capital intact for some special purpose,
perhaps to buy assets from the donor's estate at his death .
In this era, the larger foundations are sometimes created because

the donor, anticipating that part of his estate may be taxed at an
almost confiscatory rate, prefers to set this part of his estate aside,
tax free, for a public benefit rather than to have the greater part of it
pass to the Government .
But perhaps the most frequent motivation in the creation of large
foundations today is that the proprietor of a substantial enterprise,
who wishes to have it continued after his death in the hands of his
family, has insufficient liquid means available to satisfy his estate
tax obligations at death . There are other ways of solving the estate-
liquidation problem, such as buy-and-sell agreements with other
stockholders ; the carrying of sufficient life insurance ; the use of
Section 303 [formerly Section 115 (g) (3)] of the Internal Revenue
Code, which permits the corporation under certain circumstances to
purchase enough stock from the deceased, without tax penalty to the
estate, to pay the tax bill, etc . But there are many instances in which,
no other means seeming practicable, a foundation is resorted to .
The usual procedure then is to transfer (or arrange to transfer at
death) to a foundation created for the purpose enough of the owner-
ship of a corporation to reduce the estate tax impact to a point where
the liquid assets of the proprietor (and other means he may have
devised to solve the problem) are sufficient to meet the death taxes .
Such donations are usually in the form of preferred or non-voting
stock . Combinations of these advantages result :
1 . The family may remain in full voting control ;
2. The family has a pleasant partner, managed by gentle
hands ;
3 . The family may reap the benefit of any increase in the value
of the equity ;
4 . If further inflation should come, it is the family which can
become entitled to receive the benefit of the increase in monetary
value of the company ;
5 . No working capital is lost by the venture ; and
6 . The foundation may even be used as a vehicle for the em-
ployment of associates and relatives .
It is not always, however, non-voting stock which is transferred to
a foundation . Where a foundation is to be guided by friendly hands,
the donor may be willing to let it become a partner in management by
giving it voting stock . That was the case, for example, with the Duke
Foundation, the assets of which include voting stock of the Duke
Power companies . As the charter provides that this stock cannot be
sold without the consent of all of the trustees, a sale is unlikely and the
voting stock is rather sure to remain in friendly hands .
THE FORD FOUNDATION : AN EXAMPLE OF THE USE OF A FOUNDATION
TO RETAIN MANAGEMENT CONTROL OF AN ENTERPRISE .
The Ford Foundation affords a good example of the use of a founda-
tion to solve the death tax problem and, at the same time, the problem
of how to retain control of a great enterprise in the hands of the family .
90% of the ownership of the Ford Motor Company was transferred
to The Ford Foundation, created for the purpose . Had it not been,
it is almost certain that the family would have lost control . The
only practical alternative might have been to sell a large part of the
stock to the public or to bankers, or to sell the entire Company . The
huge taxes payable by the Ford estates could not have been paid with-
out liquidating a considerable part-possibly a controlling part-of
the family business . The solution selected was to give away 90% of
the Company to "charity", so that the greater part of the estates
would be free of death taxation .
The "charitable" transfers, could have been made, of course, direct
to universities, churches, hospitals and other institutions . But this
would have put the donated stock of the Ford Company into the
hands of strangers . For this reason, we assume, a foundation was
created, and to make doubly certain that there would be no inter-
ference with the Company's management, the donated stock was in
the form of non-voting shares . Not only did the family thus retain
100% voting control, but the Ford Company lost no working capital
whatsoever. Moreover, even non-voting stock can be something of
a nuisance in the hands of strangers but, held by an amiable creature,
operated by friendly nominees of the family, it would not be likely to
bring any pressure to bear on the management of the Company of
the kind which might be expected of an alert general stockholder .
There is nothing illegal about such a plan . It is entirely proper as
the law now stands and it is a mechanism frequently used to reach
just the results which the Ford family anticipated . But in the
case of a large company such as Ford, it is subject to considerable
social or economic criticism on the ground of its unfair business
impact . The April 1954 issue of The Corporate Director contained a
study of The Ford Foundation . It was referred to in detail by Mr .
Aaron Sargent, a witness before the Committee (in full, Hearings,
p. 373 et seq .). The article points out that members of the Ford
family, as officers of the Ford Company, are able to draw salaries
and are thus in a position, being assured of their own income, to
allow the Company to operate on a cost basis, without having to
pay dividends . By that means, they could bring destructive economic
power to bear upon competitors of the Ford Company which must
pay dividends to stockholders and maintain a credit position . No
other automobile manufacturing company is in a position to ignore
stability of earnings or continuity of dividend payments . If General
Motors or Chrysler earned no money, the article said, the manage-
ment heads would roll ; but Ford management would remain in power
regardless of its earning record .
There is no evidence that the Ford Company has taken any unfair
advantage of its competitors in the manner which the article describes
as possible. The point is discussed here merely to illustrate an abuse
which can accompany the use of a foundation in business and estate
planning .
The Ford Foundation has been criticised in another respect, however,
relating to unfair competition . The Television programs and other
enterprises conducted by the Foundation advertise the name of
"Ford ." This, say some critics, because the association with the
Ford automobile is self-evident, constitutes a form of advertising with
the public's money and gives the Ford Company an undue advantage
over its competitors .
THE REID FOUNDATION : ANOTHER EXAMPLE OF THE USE OF A FOUN-

DATION TO RETAIN MANAGEMENT CONTROL OF AN ENTERPRISE .
On August 2, 1946, Ogden M . Reid created and transferred to
The Reid Foundation, Inc . seventeen promissory, non-interest bearing
notes dated January 2, 1942, payable to him by the publishing com-
pany which owns the New York Herald-Tribune, a newspaper. The
notes were payable annually, starting April 15, 1953 and ending April
15, 1969 . Further notes and open accounts were left to the Reid
Foundation under Mr. Reid's will . The gift of the notes, and the
bequest of further notes and open accounts, were apparently cleared
as free of gift tax and estate tax respectively .
There seems to be considerable doubt whether these transfers were
truly tax-exempt, and a careful review of the facts by the Internal
Revenue Service might well be in order . The notes and open accounts
aggregated about eight and one-half million dollars in face value,
resulting in a huge saving in taxes to Mr . Reid's estate .
The deed of gift which transferred the first batch of notes
($2,473,392 .05) to the Foundation was an odd instrument . The notes
bear no interest . On the other hand, the transfer authorizes the
collection of the notes by the Foundation only "for its sole use and
benefit ." We assume this means that the notes apparently cannot
be transferred or sold . The Foundation thus has been given a frozen
asset, bearing no income, and with no right to sell it to produce income
from reinvestment . Is that a true "charitable" gift entitling the donor
and his estate to tax exemption? We doubt it.
It might be answered that the Foundation, even if it earns no
interest on the notes, can spend its principal . True, but its only
obligation under the tax law is to pay out its income-a payment on a
note would constitute principal and not income . Moreover, the notes
are not payable unless the New York Tribune, Inc. cares to pay them .
For the deed of gift provides that the Foundation "at the request of
New York Tribune, Inc . and from time to time, will extend or consent
to the extension of the time of payment of said indebtedness or any
part thereof on such terms and conditions as a majority of the directors
of the Donee may in their discretion decide ." The only condition
put upon this right of the publishing company to get an extension of
its obligations is "Unless such action would in the opinion of a majority
of the directors of the Donee, prejudice the right of the Donee to ulti-
mate payment of the said indebtedness ." We have italicized the
term, "the right",-the condition is only that nothing shall be done to
destroy the bare legal right eventually to collect-in other words, the
trustees are merely prohibited from completely abandoning the right
to collect a thousand years from now . Note also that, while the
Foundation may stage "terms and conditions" for an extension of
payment, they cannot deny the right to an extension which perpetuates
the debt . Note, finally, that the directors of the Foundation were
nominees of its creator, the donor of the notes . What is of even greater
significance is that of the seven directors of the Foundation, four are direc-
tors of the Herald-Tribune (see chart facing) . The two boards are,
therefore, in relation to purposes of control, Tweedledum and Tweeledee .
There are other conditions in the deed . No action can be started
to collect the notes unless (a) a majority of the directors of the Founda-
tion agree and (b) their decision is that the action is necessary to
protect "the rights of the Donee to ultimate payment-not ultimate
Officers New York Herald-Trib- Reid Foundation, Inc .

une
Chairman Helen Rogers Reid .' None .

President Whitelaw Reid .1 Helen Rogers Reid.'
Executive vice president William E . Robinson .' None .
Vice president None . Whitelaw Reid .'
Treasurer A . V . Miller .' Whitelaw Reid .'
2d vice president None . William E . Robinson .'
Secretary Stanley D. Brown . William E . Robinson .'
Directors = Ferdinand Eberstadt . Goeffrey Parsons.'
Oveta Culp Hobby. Roy Gasser .
Charles Seymour. Wilbur Forrest .
George Cornish .'
Warner R . Moor' 4
James Parton'
Everett Walker.$
Howard Davis.7
Ogden Reid .'
Barney Cameron'
1 Also member cf board of directors.

2 Chief editorial adviser, formerly chief editorial writer ; son (Jr ., was foreign editor, New York Herald-
Tribune, now with NATO, Paris) .
3 Executive editor, New York Herald-Tribune.
4 Business manager, New York Herald-Tribune .
5
Assistant to president, New York Herald-Tribune .
9
Managing editor, New York Herald-Tribune .
7 Formerly executive vice president, now president, American Newspaper Publishers Association.
' "President, New York Herald-Tribune, S . A . since 1953" (Volume 28, Who's Who) .
9 Circulation department, New York Herald-Tribune .
payment but the rights to ultimate payment . And the Foundation may
compromise the indebtedness (that is, forgive it in as large a part as
it wishes), at will, and thus virtually make a gift to the Herald-Tribune
of property dedicated to public . use .
But perhaps the most interesting clauses in the deed are those which
cast grave doubt on the basic tax-exempt character of the Foundation.
The deed recites that "It is understood and agreed" * * * that the
ultimate payment of said notes may be dependent upon the continuing
operation as a going concern of New York Herald-Tribune Inc . * * *-
"accordingly", the deed proceeds, the Donee agrees to certain condi-
tions applying to the notes . The very first of these is :
"New York Tribune Inc . shall be given by the Donee every reasonable oppor-
tunity and the full cooperation of the Donee to work out its financial affairs ."
It is the conclusion of this Committee that what was intended was
a business arrangement . We conclude that the Foundation was not
to be engaged solely in charitable work as required by the rules ex-
empting 501 (c) (3) [formerly 101 (6)] organizations . It was to
exercise charity in behalf of the New York Herald-Tribune . It was
to subordinate whatever philanthropic work had been planned to
the welfare of that newspaper and the interest of the Reid family
in it . It was a business deal . There was no free gift of the notes .
They were transferred pursuant to a contract under which the Founda-
tion agreed to assist the publishing company in its financial problem
and, by inference, but clear inference, to make this objective superior
to its presumed charitable function .
It was on its face, a magnificently designed arrangement . Whether
or not Ogden Reid's estate could have paid the heavy death duties,
if eight and a half million dollars had not been exempted, we do not
know . It is very likely that it might have been impossible to pay the
taxes on this additional eight and a half million and still retain in the
family control of a Herald- Tribune left financially sound . The general
'plan adopted was somewhat similar to that used by the Ford family .
55647-54-2
However, the Ford arrangement seems entirely within the scope and
intent of the exempting law, while the Reid arrangement would seem
to violate both its intent and its specific restrictions . We wonder
if Internal Revenue should not review its decision to exempt the
Foundation .
Comparatively little in the way of "charity" has been done by the
Foundation in relation to the size of its assumed capital-and natur-
ally so . Earning no interest, it is dependent on capital payments
from the Herald-Tribune when it chooses to make payments . There
have been some principal payments, and some of these have evidently
been used to create Reid Fellowships and for other purposes . But
its performance as an eight and a half million dollar foundation has
been, in the aggregate, understandably pitiful-its first obligation
has been to support the Herald-Tribune .
It must be noted, in closing this discussion of the Reid Foundation,
that the New York Herald-Tribune leveled quite extraordinarily
savage attacks at this Committee during its work, both in that
newspaper's editorials and in what purported to be its news columns .
EUGENE AND AGNES E . MEYER FOUNDATION .
Unlike the Reid Foundation the Meyer Foundation did not receive
its primary impetus because of the death of the donor ; as a matter of
fact, it is typical of foundations set up by individuals in order to provide
an orderly and consistent method of making contributions to their
chosen charitable and educational institutions . No criticism is made
of this entirely legitimate use of foundations .
However, this Committee has some doubts in connection with the
close relationship of the Foundation and the Washington Post Com-
pany, which in addition to owning the Washington Post and Times-
Herald also owns all the stock of WTOP, Inc ., a radio and TV station
in Washington D . C ., as well as a radio and TV station in Jacksonville,
Florida . The assets of the Foundation (1953) are approximately 7 .8
million dollars, of which 1 .65 million dollars are invested in various
securities . The balance of 6 .2 million dollars apparently represents
the value of 153,750 shares of Class B (non-voting) Common Stock
of the Washington Post Company held by the Foundation .
The net worth of the Washington Post Company cannot be obtained
from the company itself . However, there are a total of 186,750 shares
of Class B (non-voting) Common Stock outstanding, as well as 12,724
shares outstanding of Class A (voting) Common Stock . The 153,750
shares of Class B Common Stock held by the Foundation represents
82 .5% of the total of such shares . None of the voting stock is held
by the Foundation, but according to limited information available
the greater portion is controlled by Mr . and Mrs . Meyer .
In view of this intimate relationship, the intensely critical attitude
of the Washington Post and Times-Herald toward the work of this
Committee appears to be something in the nature of a defense mech-
anism, rather than the unbiased reporting of facts by a newspaper .
Again, this is a subject which warrants further study-to insure
that the press will be free of undue influence by any group with an
axe to grind, whether such groups are tax exempt or other types of
corporate organizations .
TAXES AND THE INCREASING FOUNDATION BIRTH-RATE .
It is the pressure of the present high rates of taxation which now
induces the creation of foundations . Some of the foundation execu-
tives who testified before the Cox Committee opined that the birth-
rate of foundations must soon decline because great fortunes can no
longer be made . This opinion seems incorrect . When Counsel asked
Mr. Andrews, the Commissioner of Internal Revenue, whether the
high tax rates of recent years had not "materially increased the
incidence of foundations" largely as a means for solving the problem
of liquidating estate tax obligations, the Commissioner answered :
"There is no doubt in the world about that ." (Hearings, p . 462 .)
Despite high taxation, great fortunes continue to be made . Witness
the new oil fortunes of Texas, Oklahoma and elsewhere, as well as
other startling accumulations of wealth . Indeed, many existing
small foundations are deceptive . They have been created with
small capital, to be in being at the death of the donor for the pur-
pose of receiving huge testamentary bequests .
There is no reason to suppose that great fortunes will not continue
to be built, each of which will be faced with the serious problem of
preparing for the death tax impact . Moreover, it is not only the
enormously rich who create foundations today . Countless owners
of substantial business enterprises are today planning to solve their
estate problems through the use of foundations, and there is reason
to believe that this tendency will continue and perhaps even increase .
Ingenious experts in estate and tax planning have devised many
interesting ways to use a foundation in an estate or business plan .
The use of a foundation to permit a family to control a business after
the death of the proprietor is widely promoted . For example, the
August 15, 1954 issue of the J. K. Lasser Tax Reports contains this
statement :
"Note there is nothing wrong-morally or legally-in using a foundation to
effectuate tax savings . A family can legitimately establish a foundation where
charitable motives are closely tied to reduced costs of charitable giving because of
income tax deductions allowed . Also, the owner of a business may create a
foundation so as to cut his estate tax and lea-, e his family in control of the business
after death-he leaves non-voting stock V the foundation with his family retaining
the voting stock. Control of the auto company was retained by the Ford family
in that way."
What is an increasing, rather than a decreasing, birth rate, and an
increasing aggregate of foundation funds, makes the problems treated
by this Committee all the more serious . In an address delivered at
the University of Chicago on November 27, 1952, General Counsel
to this Committee said :
"It seems to me that the ingenious legal creatures developed by tax experts to
solve the unusual social, economic, and legal problems of the past several genera-
tions will become Frankensteins, though perhaps benevolent ones. It is possible
that, in fifty or a hundred years, a great part of American industry will be con-
trolled by pension and profit-sharing trusts and foundations and a large part of
the balance by insurance companies and labor unions . What eventual repercus-
sions may come from such a development, one can only guess . It may be that
we will in this manner reach some form of society similar to socialism, without
consciously intending it . Or it may be, to protect ourselves against the strictures
which such concentrations of power can effect, that we might have to enact legisla-
tion analogous to the Statutes of Mortmain which, centuries ago, were deemed
necessary in order to prevent all of England's wealth from passing into the hands
of the church ."
If a great increase in the aggregate of foundation funds should occur,

either foundations will have to operate in a way which the country
will be certain is to its incontrovertible benefit or else strict rules of
control may have to be enacted .
CORPORATE-CREATED FOUNDATIONS .
High corporate tax rates have added to the birthrate of foundations .
Many corporations, faced with excess profits taxes, created foundations
to take advantage of their full permitted income tax deduction for
charitable gifts . By creating their own vehicles for distribution, they
are able better to organize and plan the distribution of their "chari-
ties" . They can make a single contribution at the end of each year to
the foundation and then, as in the case of an individual creating one
for the same purpose, take time to plan out the individual grants .
As each year's contribution is capital in the hands of the foundation
and not income-only the income from these contributions need be
distributed . Thus there is the possibility of large funds being built
up by corporation-created foundations which can add considerably
to the aggregate mass of foundation funds .
This Committee has not wished to take time from more pressing
problems to go into the corporate area . However, corporation-created
foundations present some special problems which are worth full study .
Two groups are sometimes inclined to oppose corporation-created
foundations-labor and the stockholders of the individual corporation .
Labor's argument is : If there is any unneeded surplus, why not pay
it to us in increased wages? The stockholders' argument is : If there
is unneeded surplus, why not pay it to us in dividends?- by distribut-
ing to charity what are really our profits (for we are the proprietors
of the company) are you not forcing us to make distributions we may
not wish to make? These arguments strike, basically, at corporate
charitable donations, as such, of course, and not at foundations per se .
But there is much to be said on the other side . From a social
point of view, the advocates of corporation-created foundations say :
private support of philanthropic causes is vital to our society, and
corporations should do their part-or, corporate philanthropic giving
is now larger, in the aggregate, than individual giving and, to dry it
up, would be catastrophic for the supported "charities"-or, corporate
giving is cheaper than giving by the individual shareholder, whose
profits, if he pays them out, would first have been subjected to cor-
porate income tax .
From a practical point of view, they argue : the corporation can
designate "charities" which are directly beneficial to its employees
and to the community within which it operates and, thus, serve 6,
practical business purpose in bettering public relations-or, the corpo-
ration can make donations which can have a definitive benefit to
itself or to its industry-as in the case of grants to technical schools
and to universities and colleges where possible future employees can
be trained and improved methods and devices can be developed .
Aside from the problems arising out of the conflicts of interest
among the stockholders, the employees and the corporation itself,
there are philosophic problems involved which merit consideration . A
corporation is a legal entity, entitled in many respects to the same
treatment as an individual . But there is a limit to its assumption
of personality . Certain privileges given as a matter of social grace
to individuals need not necessarily be granted to the fictitious per-
sonality of a corporation . Nor has a corporation any inalienable
rights . Whether a corporation, as such, is qualified to exercise
charitable patronage, involving factors such as pity and conscience is
questionable .
The problem of limiting or controlling such foundations should be
studied carefully . We shall point out in this report how vast can be
the power of an individual foundation, and how much greater when
foundations act in combination . The potential danger should not be
overlooked that huge corporation-created foundations might play too
strong and active a part in our social structure . The answer to this
problem is not abolition but some intelligent supervision or limitation .
From a practical point of view, they argue : the corporation can
designate "charities" which are directly beneficial to its employees
and to the community within which it operates and, thus, serve a
practical business purpose in bettering public relations-or, the cor-
poration can make donations which can have a definitive benefit to
itself or to its industry-as in the case of grants to technical schools
and to universities and colleges where possible future employees can
be trained and improved methods and devices can be developed .
Aside from the problems arising out of the conflicts of interest among
the stockholders, the employees and the corporation itself, there are
philosophic problems involved which merit consideration . A cor-
poration is a legal entity, entitled in many respects to the same treat-
ment as an individual . But there is a limit to its assumption of
personality . Certain privileges given as a matter of social grace to
individuals need not necessarily be granted to the fictitious personality
of a corporation . Nor has a corporation any inalienable rights .
Whether a corporation, as such, is qualified to exercise charitable
patronage, involving factors such as pity and conscience is questionable .
The problem of limiting or controlling such foundations should be
studied carefully . We shall point out in this report how vast can be
the power of an individual foundation, and how much greater when
foundations act in combination . The potential danger should not be
overlooked that huge corporation-created foundations might play too
strong and active a part in our social structure . The answer to this
problem is not abolition but some intelligent supervision or limitation .
IV . STATISTICAL MATERIAL
No comprehensive statistics are available . The source from which
one might expect to get them is the Internal Revenue Service . How-
ever, Section 101 (6) of the Internal Revenue Code included various
types of tax-exempt organizations in addition to foundations . More-
over, foundation bookkeeping introduced complications such as
cross-grants . Therefore, the Service would have been unable to
produce complete statistics except at prohibitive cost in labor and
money .
The staff of this Committee assembled, and commented upon, some
valuable statistics based chiefly on the answers to the questionnaires
sent out by the Cox Committee . See Hearings, page 9, et seq . (Note
that some adjustment must be made in using these statistics in view
of the depreciation of the dollar in recent years .) Statistical studies
made by others, notably the Russell Sage Foundation, though neces-

sarily incomplete, are also useful to give some basic financial facts .
There are between six and seven thousand foundations at the
present time, probably close to the latter figure . Their aggregate
funds amount to some $7,500,000,000, and their aggregate annual
income to nearly $675,000,000 . It is estimated that foundations of
$10,000,000 capital or over comprise only 7% of the total number,
but account for 56% of the total endowment and 32% of the aggre-
gate income of foundations .
PART TWO
FINDINGS OF FACT AND SUPPORTING MATERIAL
V. PREFATORY NOTES AND SUMMARY OF FINDINGS
The "full and complete" investigation anticipated by the creating
resolution was an impossibility under the conditions met . To some
extent, therefore, this must be regarded as a pilot study .
The creation of this Committee was greeted by some with the
question : "Why another investigation of foundations when we had
one so recently?" The answer can be found in a comparison of the
material produced by the Cox Committee and by this one . The
Cox Committee simply did not have time to do much more than it did .
A Congressional committee of this kind is chiefly dependent on its
counsel and staff for the production of research material . In its
approximately six months of theoretical, and approximately four
months of practical existence, the Cox Committee's counsel and
staff did not have time to do that preliminary research which might
have disclosed extremely important critical material. It did not
even use a considerable amount of the material it had at hand, as
much of its energies were consumed in listening to adulatory testi-
mony by foundation executives and supporters .
Hampered and limited as the current investigation has been, it has
well merited the energy given to it . It has disclosed and assembled
material never before integratedly exhibited to the Congress and the
people, and opened up lines of inquiry, the seriousness of which can-
not be overemphasized . It should act as a base for a far more
intense and extended investigation . It is the conclusion of this Com-
mittee that the subject of foundations urgently requires the continued
attention of Congress .
Should the study be resumed, we recommend that it be on a some-
what different basis . The process of investigation through public
hearings is inadequate for a subject such as that of foundations . As
we have said, an inquiry into this subject is primarily a research
undertaking . The materials of most value are to be found in
voluminous literature, reports and records . Deciding among points
of view becomes chiefly a matter of processing the mass of research
material which is available, and determining, not on the basis of
witnesses' opinions but on a judicial weighing of the factual evidence,
which are correct .
To some extent, sampling methods must be used .
Reliance on staff work and staff reports seems essential. The
Temporary National Economic Committee (TNEC) used similar
methods . It conducted hearings but leaned heavily on staff reports
published in over forty volumes . There is need for a similar thorough-
ness in approaching the foundation problems, a time-consuming use of
library sources, of questionnaires and of field studies in addition to
hearings, public or private .
15
It would thus be an injustice to arrive at generalized conclusions

except upon intense studies of wide sampling . Generalizing from a
small sample might well give a distorted picture and cause for rightful
complaint by those to whom the generalizations do not apply . We
have, ourselves, tried to be very careful not to arrive at final con-
clusions on general bases, except where the facts seemed incontrovert-
ibly to justify it. Where we have arrived at specific, in contrast to
generalized, conclusions, it has been upon specifically pertinent
material .
In some instances the experience of one particular foundation or a
sampled group may indicate a significant trend in foundation activi-
ties . It may illustrate what happens, under the system of foundation
tax exemption, to the citizens who establish foundations, to the trustees
who manage them in theory and to the executives who manage them
in fact . Foundations cannot be understood except in relation to
their acts .
SUMMARY OF COMMITTEE FINDINGS
Subject, then, to the foregoing comments, the following is a brie
summary of the more important findings of this Committee . It is
introduced here in introductory fashion . Further conclusions and
findings are contained in the subsequent text . Moreover, a reading
of the text is often necessary to amplify the brief statement of a finding
here given.
THE COMMITTEE FINDS AS FOLLOWS :
1. The country is faced with a rapidly increasing birth-rate of
foundations . The compelling motivation behind this rapid increase
in numbers is tax planning rather than "charity ." The possibility
exists that a large part of American industry may eventually come
into the hands of foundations . This may perpetuate control of
individual enterprises in a way not contemplated by existing legisla-
tion, in the hands of closed groups, perhaps controlled in turn by
families . Because of the tax exemption granted them, and because
they must be dedicated to public purposes, the foundations are public
trusts, administering funds of which the public is the equitable owner .
However, under the present law there is little implementation of this
responsibility to the general welfare ; the foundations administer their
capital and income with the widest freedom, bordering at times on
irresponsibility . Wide freedom is highly desirable, as long as the
public dedication is faithfully followed . But as will be observed later,
the present laws do not compel such performance .
The increasing number of foundations presents another problem .
The Internal Revenue Service is not staffed to adequately scrutinize
the propriety and legality of the work of this ever-enlarging multitude
of foundations .
2 . Foundations are clearly desirable when operating in the natural
sciences and when making direct donations to religious, educational,
scientific, and other institutional donees . However, when their
activities spread into the field of the so-called "social sciences" or into
other areas in which our basic moral, social, economic, and govern-
mental principles can be vitally affected, the public should be alerted
to these activities and be made aware of the impact of foundation
influence on our accepted way of life .
3 . The power of the individual large foundation is enormous . It
can exercise various forms of patronage which carry with them
elements of thought control . It can exert immense influence on
educational institutions, upon the educational processes, and upon
educators . It is capable of invisible coercion through the power of
its purse . It can materially predetermine the development of social
and political concepts and courses of action through the process of
granting and withholding foundation awards upon a selective basis,
and by designing and promulgating projects which propel researchers
in selected directions . It can play a powerful part in the determina-
tion of academic opinion, and, through this thought leadership,
materially influence public opinion .
4. This power to influence national policy is amplified tremendously
when foundations act in concert . There is such a concentration of
foundation power in the United States, operating in the social sciences
and education . It consists basically of a group of major foundations,
representing a gigantic aggregate of capital and income . There is
no conclusive evidence that this interlock, this concentration of power,
having some of the characteristics of an intellectual cartel, came into
being as the result of an over-all, conscious plan . Nevertheless, it
exists . It operates in part through certain intermediary orga niz a-
tions supported by the foundations . It has ramifications in almost
every phase of research and education, in communications and even
in government . Such a concentration of power is highly undesirable,
whether the net result of its operations is benign or not.
5. Because foundation funds are public funds, the trustees of these
organizations must conscientiously exercise the highest degree of
fiduciary responsibility . Under the system of operation common to
most large foundations this fiduciary responsibility has been largely
abdicated, and in two ways . First, in fact if not in theory, the trustees
have all too frequently passed solely upon general plans and left the
detailed administration of donations (and the consequent selection of
projects and grantees) to professional employees . Second, these
trustees have all too often delegated much of their authority and
function to intermediary organizations .
6. A professional class of administrators of foundation funds has
emerged, intent upon creating and maintaining personal prestige
and independence of action, and upon preserving its position and
emoluments . This informal "guild" has already fallen into many of
the vices of a 'bureaucratic system, involving vast opportunities for
selective patronage, preference and privilege . It has already come
to exercise a very extensive, practical control over most research in
the social sciences, much of our educational process, and a good part
of government administration in these and related fields . The
aggregate thought-control power of this foundation and foundation-
supported bureaucracy can hardly be exaggerated . A system has
thus arisen (without its significance being realized by foundation
trustees) which gives enormous power to a relatively small group of
individuals, having at their virtual command, huge sums in public
trust funds . It is a system which is antithetical to American
principles .
7 . The far-reaching power of the large foundations and of the
interlock, has so influenced the press, the radio, and even the gov-
ernment that it has become extremely difficult for objective criticism
of foundation practices to get into news channels without having first

been distorted, slanted, discredited, and at times ridiculed . Nothing
short of an unhampered Congressional investigation could hope to
bring out the vital facts ; and the pressure against Congressional
investigation has been almost incredible . As indicated by their
arrogance in dealing with this committee, the major foundations and
their associated intermediary organizations have intrenched them-
selves behind a totality of power which presumes to place them
beyond serious criticism and attack .
8. Research in the social sciences plays a key part in the evolution
of our society . Such research is now almost wholly in the control of
the professional employees of the large foundations and their obedient
satellites . Even the great sums allotted by the Federal Government
for social science research have come into the virtual control of this
professional group .
9. This power team has promoted a great excess of empirical re-
search, as contrasted with theoretical research . It has promoted
what has been called an irresponsible "fact finding mania ." It is
true that a balanced empirical approach is essential to sound investi-
gation. But it is equally true that if it is not sufficiently balanced
and guided by the theoretical approach, it leads all too frequently to
what has been termed "scientism" or fake science, seriously endanger-
ing our society upon subsequent general acceptance as "scientific"
fact . It is not the part of Congress to dictate methods of research,
but an alertness by foundation trustees to the dangers of supporting
unbalanced and unscientific research is clearly indicated .
10 . Associated with the excessive support of the empirical method,
the concentration of power has tended to support the dangerous
"cultural lag" theory and to promote "moral relativity", to the detri-
ment of our basic moral, religious, and governmental principles . It
has tended to support the concept of "social engineering"-that
"social scientists" and they alone are capable of guiding us into better
ways of living and improved or substituted fundamental principles of
action .
11 . Accompanying these directions in research grants, the con-
centration has shown a distinct tendency to favor political opinions
to the left . These foundations and their intermediaries engage
extensively in political activity, not in the form of direct support of
political candidates or political parties, but in the conscious promotion
of carefully calculated political concepts . The qualitative and
quantitative restrictions of the Federal law are wholly inadequate to
prevent this mis-use of public trust funds .
12 . The impact of foundation money upon education has been
very heavy, largely tending to promote uniformity in approach and
method, tending to induce the educator to become an agent for social
change and a propagandist for the development of our society in the
direction of some form of collectivism . Foundations have supported
text books (and books intended for inclusion in collateral reading
lists) which are destructive of our basic governmental and social
principles and highly critical of some of our cherished institutions .
13 . In the international field, foundations, and an interlock among
some of them and certain intermediary organizations, have exercised
a strong effect upon our foreign policy and upon public education in
things international . This has been accomplished by vast propa-
ganda, by supplying executives and advisers to government and by
controlling much research in this area through the power of the purse .
The net result of these combined efforts has been to promote "inter-
nationalism" in a particular sense-a form directed toward "world
government" and a derogation of American "nationalism ." Founda-
tions have supported a conscious distortion of history, propagandized
blindly for the United Nations as the hope of the world, supported
that organization's agencies to an extent beyond general public
acceptance, and leaned toward a generally "leftist" approach to
international problems .
14 . With several tragically outstanding exceptions, such as The
Institute of Pacific Relations, foundations have not directly supported
organizations which, in turn, operated to support Communism .
However, some of the larger foundations have directly supported
"subversion" in the true meaning of that term, namely, the process
of undermining some of our vitally protective concepts and principles .
They have actively supported attacks upon our social and govern-
mental system and financed the promotion of socialism and collectivist
ideas.
VI . THE POWER OF THE LARGE FOUNDATION
THE IMPACT OF SIZE .
Several executives of large foundations in their statements at the
Cox Committee hearings expressed the opinion that some regulation of
smaller foundations might be desirable because they are so frequently
set up for tax or other personal advantages . The same executives
expressed the opinion that further regulation of the large foundations
was undesirable . We believe that the premises upon which these
conclusions were based are erroneous . Great foundations are also
set up for tax or other personal advantages . Moreover there is a
distinct danger in me F size .
In the so-called Walsh investigation, which took place in 1917, both
Samuel Untermyer and Louis D . Brandeis concluded that the founda-
tion as a perpetuity was "inconsistent with democratic conceptions ."
Granting that they might then have been in the hands of good men,
the fear was expressed that foundations might become "great powers
for evil in the hands of persons whom we cannot foresee ." They
might even, it was feared, grow stronger than the Government .
This fear was based upon the conservative character and poor
public relations of the creators of the first great foundations ; it was
anticipated that the power of the huge foundation funds could be
used for "reactionary" purposes . The current vice seems to be that
some of the great foundations are now permitting their funds to be
used largely in the promotion of projects politically directed to the
left . But the issue is not whether these great public trusts are being
employed in one political direction or another . The issue is whether
there should be any political direction in the use of public trust
moneys . We share the fear of men like Untermyer and Brandeis that
the power in itself constitutes a threat and a danger .
According to Raymond B . Fosdick, in his The Story of the Rocke-
feller Foundation, when Federal incorporation of the Foundation was
sought, protests were made not only on the basis of the prospective
power of such a foundation but also of its possible use as a medium for

perpetuating wealth . The following is from Dr . Fosdick's book, on

page 18:
" . In letters which have since been published, it appears that George W .
Wickersham, the Attorney General, wrote to President Taft denouncing the
proposal. `Never,' he declared, `has there been submitted to Congress or to any
legislative body, such an indefinite scheme for perpetuating vast wealth as this ;
and personally I believe it to be entirely inconsistent with the public interest that
any such bill should be passed .' To this Mr. Tuft replied : Ì agree with your . . .
characterization of the proposed act to incorporate John D . Rockefeller.' "
Some of the individual foundations have increased enormously in
size through the accumulation of income (now more carefully restricted
than before) and through accretions in capital value (wholly unre-
stricted) . In spite of heavy expenditures, some of the foundations
are now far larger in capital than they were when created . Where,
as is frequently the case, the foundation portfolio contains blocks .of
equity stocks in growing enterprises, the limits of capital increase
cannot be foreseen .
The power to allot or distribute substantial funds carries with it
the opportunity to exercise a substantial degree of control over the
recipients . We tolerate such risks to society in the free and uncon-
trolled use of private funds . An individual of wealth has wide free-
dom to expend his money for power or propaganda purposes ; in the
process, he may obtain control of educational institutions, media of
communication and other agencies which have an important impact
on society . Distasteful though this may sometimes be, broad
freedom to do it is consonant with our general ideas of freedom and
liberty for the individual .
W hen we are dealing with foundations, the situation is quite
different . Problems arise in connection with granting full liberty to
foundations which increase geometrically with their size . The power
of the purse becomes something with which the public must reckon .
For these great foundations are public trusts, employing the public's
money-become so through tax exemption and dedication to public
purposes . Foundations are permitted to exist by the grace of the public,
exempted from the taxation to which private funds are subjected, and are
entitled to their privileges only because they are, and must be, dedicated
to the public welfare . The public has the right to expect of those who
operate the foundations the highest degree of fiduciary responsibility .
The fiduciary duty is not merely to administer the funds carefully from
a financial standpoint . It includes the obligation to see that the public
dedication is properly applied .
The large foundations admit this fiduciary responsibility and affirm-
atively proclaim their consciousness of it . But, the freedom of action
they insist on sometimes permits transgressing the border of license .
The trustees of the foundations are, by overwhelming preponderance,
estimable men ; their errors of operation chiefly result from an apparent
misconception of their fiduciary duty . It is not that they do not
intend to act with full trust responsibility ; they are perhaps too often
too busy to think their problems through in detail .
There are limits to their freedom of action as trustees . Their
financial power gives them enormous leverage in influencing public
opinion . They should thus be very chary of promoting ideas, con-
cepts and opinion-forming material which run contrary to what the
public currently wishes, approves and likes . Professor Thomas H .
Briggs,' an eminent educator, put it this way in his testimony
(Hearings, p . 96) :
But whatever the stated purpose or purposes, the public has a deep concern
and an actual responsibility to see that the activities of each and every founda-
tion, whether its resources are large or small, not only does not harm but also
contributes to a maximum degree possible to the welfare of the Nation . This
right and this responsibility are derived from the fact that the public has chartered
the foundations and also that by remission of taxes it is furnishing a large part of
the available revenue . In the case of the Ford Foundation, which has an annual
income in excess of $30 million, the public contributes more than $27 million, or
$9 to every $1 that comes from the original donor .
In addition to the right and the responsibility of the public to insure that founda-
tion moneys are spent for the maximum good of society in general, the public is
concerned that no chartered foundation promote a program which in any way and to
any extent militates against what society has decided is for its own good . [Emphasis
ours .]
Dr . Frederick P. Keppel once said that the officers of foundations
steadily tend toward "an illusion of omniscience and omnipotence ."
They thus fall easily into the error of deeming themselves a group of
the elite, entitled to use the seductive methods of educational and
research propaganda to promote what they themselves believe to be
best for the people . In this they seem to follow the thesis of Jean
Jacques Rousseau .
Rousseau was perhaps the most ardent intellectual supporter of
absolute democracy . He believed that the majority must rule with-
out hindrance, and that minority rights are nonsense . Yet he was
the intellectual father of Communism and Fascism . For, while he
believed in the absolute rights of the majority, he did say that the
people did not always know what was good for them ; presumably a
group of the elite would have to tell them . Thus, in both totalitarian
systems, an elite group controls the state for the presumed benefit of
the mass . Such a system is antithetical of our own . As Prof .
Briggs said :
The principle that the public should decide what it wants in order to promote
its own welfare and happiness is unquestionably sound . An assumption that the
public does not know what is for its own good is simply contrary to the funda-
mental principles of democracy . (Hearings, p . 98 .)
The fact is that the foundations have become a force in our society
second only to that of' government itself . Administering about
seven and a half billion dollars, of which a very small number control,
about a third, they are in a position, through the power of public
money to make their influence felt so heavily as to warrant careful
study of the line between freedom of action and license .
PUBLIC ACCOUNTABILITY .
Annual returns are required of the foundations which give certain
information to the Federal government. Parts of these reports are
open to the public . Others are not ; they may be examined only by
Executive Order of the President of the United States . Even this
Committee, as earlier described, has had difficulty in securing such
an order ; the public in general has no chance of securing one . Thus
even the material which by law must now be recorded is not fully
open to the public . This Committee fails to understand why any part
of any report by a foundation should not be open to the public . Its
fu nds are public and its benefactions, its activities, should be public
I Professor emeritus, Columbia University .
also . In any event, the report which must be filed is wholly inade-
quate to enable either government or the public to determine whether
a foundation has fulfilled its duty to the public .
Some of the major foundations prepare and issue public reports
which are admirable as far as they go, disclosing full financial state-
ments and descriptions of their work during the period covered by the
report. But even these are inadequate fully to inform the public of
the backgrounds, the motivations, the detail of operation and the
results of the activities of the foundations .
While truly full reports would give to those interested an oppor-
tunity to be critical, such criticism would be ineffective in most in-
stances . The foundations are free to do as they please with the public
funds at their command, so long as they do not transgress certain
rules of law which are so general in their terms, and so difficult to
interpret except in a few instances, that they are virtually useless as
deterrents . Political propaganda, for example, is proscribed . But
many foundations do engage in active political propaganda, and the
present laws cannot stop them .
The testimony of Internal Revenue Commissioner Andrews and
Assistant Commissioner Sugarman brought out clearly (1) that the
courts have construed the restrictions in the tax law very liberally,
perhaps far too liberally ; (2) that the Internal Revenue Service has
great difficulty in drawing lines ; and (3) that it does not have the
manpower or the machinery to act as a watchdog to make sure that
the law is not violated .
Where the organization claims exemption on the ground that it is
"educational" the law requires that it have been organized exclusively
for that purpose, yet the word "exclusively" has been weakened by
judicial interpretation . Again, the words proscribing political
activity provide that it may not use a "substantial" part of its funds
in that area . The test is thus quantitative as well as qualitative, and
the difficulty in determining the borderlines can well be imagined .
The fact is, and this seems to us of enormous importance, that the
Internal Revenue Service cannot possibly read all the literature pro-
duced or financed by foundations, or follow and check the application
of their expenditures . The Commissioner must rely chiefly on com-
plaints by indignant citizens to raise a question in his own mind .
Even then, it is difficult for the Service to carry this burden, both
from limitations of personnel and budget, and because it is here
concerned with an area which requires technical skill not normally
to be found in a tax bureau .
Our conclusion is that there is no true public accountability under
the present laws.
What is the penalty if, by chance, serious malfeasance is proved-
perhaps by substantial grants for subversive purposes or for active
political propaganda? The mere loss of the income tax exemption .
That is the sole penalty, other than the loss of the right of future
donors to take gift or estate tax exemption on their donations . The
capital of the foundation may still be used for a malevolent purpose .
The trustees are not subjected to any personal penalty . The fund
merely suffers by, thereafter, having to pay income tax on its earnings!
ABDICATION OF TRUSTEES' RESPONSIBILITY .
The great foundations are enterprises of such magnitude that they
cannot be managed by visiting trustees . In their filed statements,
several of the foundations have denied indignantly that their trustees
neglected their work . The fact is that, as some of the large founda-
tions are organized, the trustees cannot fully perform those duties
which their fiduciary responsibility imposes .
An illustration of this was given b Professor Briggs in discussing
the Ford Fund for the Advancement of Education . He indicated that
the trustees were too busy with their own affairs and "put trust in
their elected administrative officers ." In the foundation subsidiary
to which he referred he said all of these officers were "directly or
indirectly nominated by a former influential officer of The Ford
Foundation who is notoriously critical-I may even say contemptu-
ous-of the professional education of teachers ." The result in this
instance he described as follows :
These administrative officers doubtless present to the board, as they do to the
public, a program so general as to get approval and yet so indefinite as to permit
activities which in the judgment of most competent critics are either wasteful
or harmful to the education program that has been approved by the public .
(Hearings, p . 97 .)
To do a truly fiduciary job, as a trustee of one of the major founda-
tions, would require virtually full time occupation .
Typically in the large foundation, there is a set of eminent and
responsible trustees at the top who may well wish to be alert to their
public duty. Most, however, are busy men with many other occupa-
tions and avocations . They may attend quarterly meetings, some-
times less often, rarely more . At such meetings they may be pre-
sented with voluminous reports and be asked to consider and give
their approval to programs and projects . However long such meetings
may last, it is impossible for such trustees to fulfill their fiduciary
responsibility adequately at the equivalent of directors' meetings .
In such infrequent attendance, they cannot give the attention to
the detail of management which the trust nature of these enterprises
requires . Perforce, they delegate their powers to professional subordi-
nates, sometimes selected for their peculiar knowledge of the field,
sometimes selected casually and without previous experience or special
knowledge.
That they are not always careful in their selection of executives
and staffs is attested by this testimony of Professor Briggs, in which
he refers to The Ford Fund for the Advancement of Education, upon
whose Advisory Committee he served until his resignation in disgust
(Hearings, pp . 96-97) :
Not a single member of the staff, from the president down to the lowliest employee,
has had any experience, certainly none in recent years, that would give under-
standing of the problems that are met daily by the teachers and administrators
of our schools . It is true that they have from time to time called in for counsel
experienced educators of their own choosing, but there is little evidence that they
have been materially influenced by the advice that was proffered . As one prom-
inent educator who was invited to give advice reported, "any suggestions for
changes in the project (proposed by the fund) were glossed over without discus-
sion ." As a former member of a so-called advisory committee I testify that at
no time did the administration of the fund seek from it any advice on principles
of operation nor did it hospitably receive or act in accordance with such advice
as was volunteered .
Mr. Alfred Kohlberg testified before the Cox Committee . As a
member of the Institute of Pacific Relations, he had brought up charges
of subversion apparently before The Rockefeller Foundation's trustees
had become aware that anything was wrong with their long-favored
beneficiary . He also testified to certain communications he had had

with John Foster Dulles when Alger Hiss had been made President of
The Carnegie Endowment For International Peace at Mr . Dulles'
suggestion . When Mr . Kohlberg was asked if he was critical of Mr .
Dulles for his connection with the Hiss matter, he stated that he was
critical in general of the trustees of the two large foundations con-
cerning which he had testified-The Carnegie Endowment and Rocke-
feller Foundation-on the ground that they "delegate most of their
duties to the staff." He continued : "And while we all realize that
they are very busy men, that the affairs of these foundations are vast
in scope, I criticize them for a lack of understanding of the damage
that can be done to the country when these institutions get infiltrated
or when institutions they are aiding get infiltrated with communists ."
Mr. Kohlberg illustrated further :
"That has been the reaction-the trustees of the Institute of Pacific Relations,
for example, which has now been found by the Senate committee to be considered
an organ of the Communist Party of the United States, by the Communist Party,
the majority of those trustees are men of unquestioned integrity, and although
charges were brought to their attention-what is it? Eight years ago?-they
have never yet investigated it on their own ."
An analogy with a commercial enterprise is not correct . Some
foundations, like the Twentieth Century Fund, engage directly in
research projects . Others are in the business of distributing funds to
still others for research and other purposes. In either case, the
operation is not a private one for profit but a public one for the public
benefit, and the obligations of the trustees extend far beyond the
limited fiduciary responsibility of a commercial director .
These obligations are comparatively easy to meet in small founda-
tions with moderate operations . The larger the foundation enterprise,
the more difficult the execution of the fiduciary duty . So complex
and intricate have some of the foundations become that a few, like
the Ford Foundation, have felt obliged to divide themselves into
subsidiaries and affiliates . The diagram set opposite this page shows
part of the intricacy of the Ford operation .
Trustees of great foundations are unable to keep their fingers
on the pulse of operations, except to very limited degree . They
cannot take time to watch that detail of operation which alone would
give them an insight into the fairness and objectivity of selections .
Nor can they see to the effect of what they have permitted to be
done . They incline generally to feel that they have done their part
when a grant has been made . They seem to have neither the time
nor the disposition to study the consequences of the grant, its impact
upon society . No other explanation of the long-continued enormous
grants by The Rockefeller Foundation and others to The Institute of
Pacific Relations, nor of the Rockefeller support of the Kinsey reports,
seems logical .
Mr. Henry Allen Moe, of the John Simon Guggenheim Memorial
Foundation put it this way in this statement before the Cox Com-
mittee:
* * * 'delegatus non potest delegare,' that is to say that no trustee can
delegate his trust function .
He proceeded to say that neither within law nor equity could trustees
delegate their judgment .
What is this judgment, the chief component of the trust function? It
is the judgment of the desirability of a grant, both as to specific purpose and
`.
%s to the identity of the grantee . It is this which cannot be delegated .

Yet it all too frequently is delegated to professional subordinates who
do not have the duty of trustees . Clearly enough, where a great
many grants are to be awarded, administrative assistance is unavoid-
ably necessary . But ultimate responsibility must rest on the trustees .
They may have assistance, but they cannot merely shunt off the process
of selection to others, perfunctorily accepting what these agents have
decided. If the problem is that the size of some foundations prevents
selections by the trustees themselves, the answer cannot lie in an
abandonment of responsibility by delegation but perhaps in a radical
reorganization of its processes and methods .
Some trustees seek to escape the full impact of the principle of
delegatus non potest delegare, by organizing themselves in such manner
that they are expressly excluded from the detail of selection . For
example, the Ford Foundation caused a report to be prepared called
the Report of the Study .for the Ford Foundation on Policy and Program,
dated November 19, 1949 . This report contained the following
passages :
"Individual members of the Board of Trustees should not seek to decide the
technical questions involved in particular applications and projects . Nothing
would more certainly destroy the effectiveness of a foundation . On the contrary,
the Trustees will be most surely able to control the main lines of policy
of the Foundation, and the contribution it will make to human welfare, if they
give the President and the officers considerable freedom in developing the program,
while they avoid influencing (even by indirection) the conduct of projects to
which the Foundation has granted funds ." (Pages 127 and 128.)
"As individuals, the Trustees should learn as much as they can by all means
possible, formal and informal, about the program of the Foundation in relation
to the affairs of the world . But the Board of Trustees, as a responsible body,
should act only according to its regular formal procedures, and usually on the
agenda, the dockets, and the recommendations presented by the President ."
(Page 128 .)
"The meetings of the Board should be arranged so that the discussion will not
be directed mainly at the individual grants recommended by the officers, and
institutions to receive them . Nothing could destroy the effectiveness of the Board
more certainly than to have the agenda for its meetings consist exclusively of
small appropriation items, each of which has to be judged on the basis of scientific
considerations, the academic reputation of research workers, or the standing of
institutions . If the agenda calls solely for such discussions the Board will neces-
sarily fail to discuss the main issues of policy and will inevitably interfere in mat-
ters in which it has no special competence ." (Page 130 .)
"A foundation may wish from time to time to make small grants, either to ex-
plore the possibilities of larger programs, or to take advantage of an isolated and
unusual opportunity . For such purposes it will be useful for the Trustees to set
up (and replenish from time to time) a discretionary fund out of which the Presi-
dent may make grants on his own authority . The Trustees should set a limit on
the aggregate amount which the President may award in discretionary grants
during a given period, rather than set a fixed limit on the size of a single grant .
* * *" (Page 132 .)
"The President of The Ford Foundation, as its principal officer, should not only
serve as a member of the Board of Trustees, but should be given full authority
to administer its organization .
"He should have full responsibility for presenting recommendations on program
to the Board, and full authority to appoint and remove all other officers and em-
ployees of the Foundation . * * *" (Page 132 .)
"The founders of at least two of the larger American foundations intended
their trustees to devote a major amount of their time to the active conduct of
foundation affairs . Usually this arrangement has not proved practicable . * * *"
(Page 133 .)
"* * * for the program of a foundation may be determined more certainly by
the selection of its top officers than by any statement of policy or any set of direc-
tions . * * *" (Page 133 .)
55647-54 3
We cannot escape the conclusion that the trustees of the Ford Foundatioi
abdicated their trust responsibility in assenting to this plan of operation
under which everything except possibly the establishment of glittering
generalities could be left to employees.
On the subject of trustees' responsibility, Professor Kenneth Col .
grove z testified under questioning as follows :
Mr . WORMSER . Professor, I would like your comments on this subject, if yot
will . The trustees of these foundations have a distinct fiduciary responsibilit3
which they recognize, in principle, at least, as the trustees of public funds . I
seems to me the most important trust function they have is to exercise judgmen,
in connection with the selection of grants and grantees . Does it not seem t(
you that to a very large extent they have abandoned that trust function, thai
trust duty, and have delegated the whole thing to other organizations? That it
certain areas they have used these intermediate organizations to fulfill their
judgment function for them, which they, as trustees, should exercise? Woulc
you comment on that?
Dr . CoLECaovE . I think that has very largely occurred . I do not quite like
to put it this way, but the trustees are in many cases just window dressing t(
give popular confidence in the institution . In the United States we think ar
institution needs a very distinguished board of trustees ; and, of course, yoi
know, from college experience, a great many men are made trustees of a uni-
versity because the university expects them to make a large donation to the
endowment fund or build a building or something like that . And to offset e
group of rich trustees, you put on some trustees who have large reputations it
the literary world or in other fields than merely finance .
Many of the trustees, I am afraid, have gotten into a very bad habit . They
are perfectly realistic . They know why they are put on the board of trustees .
And they are not as careful as they should be in taking responsibility for the
operation of those organizations .
I think the Carnegie Endowment for International Peace, which was set uF
under Elihu Root and President Nicholas Murray Butler way back, I think ;
about 1908, had a board of trustees picked by President Butler, and I think
Butler expected to get a great deal of advice from those trustees .
But I do recall many years later President Butler told me that he had to use
very extraordinary methods to get his trustees to meet even for the annual
meeting .
Mr. WORMSER . Then, in practice, they delegate their authority partly to other
organizations . Of course, where they do make their own grants directly, they
delegate enormously to their professional employees, the executives, who do not
have the same trust responsibility but are merely executives .
Dr . CoLEOROVE . Yes, they delegate their authority in several directions .
Trustees delegate their authority to the president of the foundation . The presi-
dent in large measure even delegates his authority to the heads of departments .
A president of one of these large funds sometimes is a little hazy about what is
happening in this division or in that division . And in these heads of departments-
let's say of the Rockefeller Foundation, where you have the social sciences and
humanities-you will find a delegation of authority in the case of the social sciences
to the operating society, The Social Science Research Council, and to The American
Council of Learned Societies in the case of the humanities . So you have a delega-
tion of authority in two directions there .
Mr . WORMSER. So whether a foundation fulfills its obligation to the public
rests primarily on the selection of its employees and the association with these
intermediate groups . Is it your opinion, Professor, that these employees-I
don't mean in a derogatory sense to say "employees", the officers of these organiza-
tions-are on the same caliper as a whole, do they compare well with university
executives or those who would administer grants under university administration?
Dr . COLEGROVE . Well, I think those of us in political science feel that Joe
Willits, 3 who was a professor of the University of Pennsylvania before he took the
position that he has at the present time, is an outstanding scholer, a most com-
petent administrator, a very good judge of human nature . And yet he cannot
give all of his attention to the expenditure of these vast sums .
3 Formerly Professor of Political-Science Northwestern University, where he taught for 30 years before
his automatic retirement at age 65 . For eleven years, Secretary and Treasurer, American Political Science
Association .
3 Vice-President, The Rockefeller Found

What applies, of course, to The Rockefeller Foundation applies even more forcibly
to The Ford Foundation, which is much larger .
Mr. WORMSER . One witness, Professor Briggs, testified that in his opinion there
wasn't one single employee in the Ford Fund for the Advancement of Education,
from the top down to the bottom, who had had enough experience in the areas
in which they were operating to make proper judgments . That does not sound
very good for foundation practices, if they select men as carelessly, let us say, as
that. I am trying to make a comparison with universities, because I am interested
particularly in the possibility that a better medium for foundation largesse may
be through the universities, instead of through professional agencies .
Dr . COLEOROVE . Oh, quite true . I think it would require a larger number of
topnotch administrators in the foundations to exercise more critical judgment
than can be exercised at the present time. Even there, however, you would have
to choose between universities ; and if you are going to the small colleges, there is a
case where you would have to have many careful surveys and studies, and an
acquaintance with the personnel and faculties of those universities . Probably
the staffs of high-grade men, let us say men serving under Dr . Willits, ought to
be a little higher caliber .
Mr . HAYS. Well, now, you talked a little bit ago about the delegation of
authority . Do you have any specific ideas about what we could do to remedy
that, if that is bad? I mean how are you going to get away from it?
Dr . COLEGROVE . Well, you cannot avoid delegation of authority, but a good
administrator has to know how to delegate . He has to choose to whom he is
going to delegate, and choose what powers he is going to delegate, and then
finally he has to have his system of reviewing the achievements of persons to
whom power to make decisions has been delegated .
Mr . WORMSER. May I interrupt to help Mr . Hays' question?
Mr . HAYS . You are sure this is going to be helpful?
Mr . WOEMSER . Yes, Sir .
Mr . Hays has said that it seemed to him a trustee should not act as a trustee
of a foundation unless he was willing to give the time to it that was necessary .
It seemed to me that that was a very apt remark . And I wonder if that is not
the answer, that these men are so busy with their own lives that although they
are eminent they are not capable of being trustees of foundations . That is no
criticism of them as persons .
Dr . COLEOROVE . Yes ; undoubtedly many of the trustees would not serve if
they felt that they would be called upon to do much more than go to the meet-
ings, hear the reports, and sometimes not say a single word . You would not
have as brilliant, as lofty, as remarkable, a collection of men as trustees if you
required a little more responsibility on their part . I would say, on the whole,
the board of trustees is too large . There are too many remarkable men, in New
York and elsewhere, who are trustees of more than one foundation . And just
as we exercise in the American Political Science Association a "self-denying
ordinance" where no member of the association speaks more than twice in an
annual meeting, I would like to see these interlocking trusteeships more or less
abolished . You cannot abolish them by law, of course . You could abolish them
by practice . So you would reduce the size of the board of trustees and then
expect more consideration, more consultation, more advice, from the men who
had accepted this great responsibility .
Mr . WORMSER . Was that not your idea, Mr . Hays, that they should be working
directly?
Mr . HAYS . Oh, sure. Exactly . (Hearings, pp . 583, 584, 585, 586 .)
Mr. Koch, the Associate Counsel joined in the colloquy with a
comment which seems to this Committee especially apt:
Mr . KOCH. Here is something that worries me . Suppose I had a great big
motor company or a steel mill or this and that, and they picked me because they
wanted, as you say, window dressing . The first thing that puzzles me is why they
need window dressing in a foundation of this kind . If you are running a founda-
tion where you go to the people every year, like the Red Cross or the March of
Dimes, for money, then you want to impress the populace that there are big
names behind it . But here, where Mr . Ford or Mr . Carnegie or Mr . Rockefeller
plumps millions of dollars in the laps of the foundation, and they do not have to
go to the public for 1 cent more, I always wonder : why do they need big names
in that case? And would it not be better, instead of picking me, the head of a
big steel mill, pick somebody who was a little more familiar with the educational
field? Because I can see exactly what I would do if I were that fortunate head
of a big steel mill . As soon as somebody said, "Let us do something about educa-
tion, or study this," if I were honest, I would immediately say, "I do not know
anything about it, so what do the professors say?" And the professors would
immediately tell me what they thought the trend of the times was, and I would
say, "I will be safe if I follow the trend of the times ."
And it seems to me the dismal part of the testimony so far is that there has
been so much unanimity among the big foundations in following the supposed
trend of the times . I would rather see one day Rockefeller in this corner slugging
it out with Ford Foundation in this corner to try to argue a particular thing .
Here we get into a depression, and we find out Professor Beard and Professor
Muzzey have said things they later veered away from, and yet all of the founda-
tions at that time may have put their money in the direction of that project,
pushing the pendulum along much farther than it probably should have been
pushed . And yet there was no foundation that said, "Well, change may be
necessary, but let us find out what is good about the old order so that, when we
decide on the change, we have at least heard both sides ."
It seems to me there has not been that debate . And it may have been prob-
ably because the big name probably said, "We don't really know much about it
ourselves . We will have to see what is the fad, what the ladies are wearing in
Paris today, or what the trend is in education ." I therefore wonder whether
it would not be better to suggest that where they do not need big names they get
lesser names who can spend more time and are a little bit more familiar with the
subject matter . That, unfortunately, was an awfully long speech, but that has
been worrying me .
Dr . CoLEGRovE . I think you have given an accurate picture of the actual
situation . The large number of famous names on the list of trustees is due to
the old superstition that our institutions must be headed by a famous group of
men . And I will say frankly it is to impress Congress as well as the American
people ; to impress public opinion as fully as possible . It is an old superstition .
It is not necessary at all. With a group of 7 trustees, using 7 because it is an
odd number, I imagine most of these trustees if they were trustees of only one
other organization, maybe trustees of a church, would be able to give more
attention to their duties as trustees of foundations . They could not pass on the
responsibility . (Hearings, pp . 586, 587 .)
One of the dangers of delegating excessive authority to officers and
employees of a foundation is that there is a tendency for these dele-
gates to run off with the entire operation and, for all practical pur-
poses, to take it away from the trustees who bear the fiduciary duty
to the public .
Professor David N . Rowe a testified that the directors of the Insti-
tute of Pacific Relations (of whom he was one for several years) had-
very little control over the day-to-day operation . I don't know whether this is
characteristic of all boards or all organizations, but I felt, and I testified previously
to this effect, that the IPR was essentially controlled by a very small group of
people who were sometimes an official executive committee, or otherwise an
informal one, who ran things pretty much as they would and who commented to
the Foundation's own personnel and problems of the kind I was talking to Evans 5
about in exactly the opposite way . (Hearings, pp . 538, 539 .)
In answer to the question why, like directors of a bank, the directors
of I . P . R . had not been able to learn the mischief which was going on
and to control it, Professor Rowe replied :
* * * I would have the greatest respect for the ability of either of you gentle-
men or others that I know to read a bank balance sheet and to tell the difference
between red ink and black ink . As you say, that is your business . You are on
the board of directors ; you have to know. But I would like to know whether you
would have equal confidence in your ability at all times as a member of a board of
directors to be able to point the finger at the fellow that is putting his fingers on
4Professor of Political Science, Yale University .
a Roger Evans, Social Science Director of the Rockefeller Foundation .

the till . You can't do that, so you bond these people . You bond them against
losses, and you protect yourself, and the bank, and you have a system for doing
that .
You don't have a system like that in the intellectual world . You try to work
one up and I will be the first to adopt it . I will say this . You are never going to
be(able to spot such people, who operate down in the levels (of) an organization, from
away up high where the directors sit, because they don't know what the people
are doing, they can't possibly supervise them directly . This is left to the executive
people . If the executive people know what they are doing-I testified before the
McCarran committee that I was present once at a board of directors' meeting of
the IPR at which they were discussing the appointment of a new executive secre-
tary, and I had to sit there in the board and hear the executive committee members
refuse to divulge the names of the candidates they were thinking about in the
presence of the board of directors, and they got away with it .
Mr. HAYS . What did you do about that?
Dr . RowE . What could I do . I was practically a minority of one. The board
upheld their decision not to do this . It was not too long after that as I remember
it that I resigned from the board. They had a monopoly and they were bringing
people like me in for purposes of setting up a front, and I hope, giving a different
kind of coloring to the membership of the board .
Mr . WORMSER . How often did that board meet, Professor?
Dr . ROWE . I don't think I ever was called in there more than once a year, and
you would spend a couple of hours, and that is all .
Mr . Kocx . Did the men come from all over the United States on that board?
Dr . RowE . The last meeting I attended the members from California were not
present . There was a member there from Oregon .
Mr . Kocx . But was the membership of the board spread over the United
States?
Dr . RowE . Yes, it was, and those people could not always attend . (Hearings,
pp . 542, 543 .)
Mr . Hays later made his apt comment that no one should remain
on the board of directors unless he could give the proper time to its
work, whereupon Professor Rowe answered :
Dr . ROWE . I would have been perfectly willing to sacrifice the time necessary
to get full information and participate in policy decisions . One of the things that
motivated me was the fact that you could spend the time-I could-but you could
not get the facts and information or get in the inside circles . I submit to you
that taking 3 years to find that out in an organization of the complexity of the
IPR was not an unconscionably long period of time . (Hearings, p . 544 .)
We do not believe that public trusts are properly administered through
delegated fiduciary authority . We question whether individuals should
act as trustees if they are too busy or otherwise occupied to give the work
the full attention which their fiduciary duty requires . The trustees of
the Carnegie Corporation and the Rockefeller Foundation could not
have permitted continued grants to something like I . P . R . had they
been aware of what was going on . But the expenditure of sufficient
time in checking and observing would have made them conscious of
what the Institute of Pacific Relations was doing to our country . To
expend that time seems to us the duty of a foundation trustee . To fail to
do so is to fail in the discharge of a fiduciary duty to the public. Alertness
on the part of the Rockefeller and Carnegie trustees, and expenditure
of the time necessary to see to the use made of the public's money by
I . P . R . might have saved China from the Communists and prevented
the war in Korea .
The extent to which trustees of foundations have further delegated
their authority and abdicated their responsibility through the use of
intermediary organizations, will appear in the next section of this
report,
THE SOCIAL SCIENCES .

Raymond B . Fosdick, in The Story of the Rockefeller Foundation,'
quoted Mr . Gates, long-time advisor to John D . Rockefeller, Sr., in
matters of charity, as follows :
"If I have any regret, it is that the charter of The Rockefeller Foundation did
not confine its work strictly to national and international medicine, health and
its appointments * * * Insofar as the disbursements of the Rockefeller incorpor-
ated philanthropies have been rigidly confined to these two fields of philanthropy
(medicine and public health) they have been almost universally commended at
home and abroad . Where they have inadvertently transgressed these limits,
they have been widely and in some particulars perhaps not unfairly condemned ."
In his article in the New York Times of March 1, 1954, Mr. Leo
Eagan attributes wide concern about foundations in part to "a belated
recognition of the great influence that foundations have exercised on
social developments and ideas", and "a fear that a changing emphasis
in foundation programs may upset many long-established social
relationships ."
Foundations can play a powerful role in ushering in changes in our
form of society . As Frederick P. Keppel, himself President of the
Carnegie Corporation, put it in The Foundation ; Its Place in American
Life (p. 107)
"We all know that foundation aid can increase measurably the pace of any social
tendency, but we don't know when this artificial acceleration ceases to be desirable
* * * All I can say is that here as elsewhere safety lies in the fullest available
information as to foundation affairs and the widest possible discussion regarding
them ."
The dangers inherent in size, and the accompanying power which a
large purse gives, apply to some degree in all fields of foundation oper-
ation . They are most hazardous, however, in the so-called "social
sciences ."
Dean Myers of the New York State College of Agriculture defined
the social sciences in the Cox Committee hearings as follows :
"The subject or the name `social science' is intended to cover those studies which
have as their center man in his relation to other men as individuals, as groups, or
as nations.
"Perhaps the name `social science' might be made clear by indicating its relation
to other branches of knowledge, the natural or physical sciences which relate to
the physical world, the medical sciences which are self-explanatory, the humanities
which deal with art, literature, with things of the spirit, and the social sciences
which are concerned with the studies of man as an individual, as groups, and as
nations ."
Within the scope of the term "social sciencies" he named as typical :
economics ; psychology ; sociology ; anthropology ; political science or
government ; demography or populations studies; history ; statistics ;
and various sub-divisions of these .
While mistakes in the other branches of knowledge may have serious
results, there is not in them nearly the room for damage to our society
which exists in the social sciences . Possibilities of error and mischief
are so much greater . The methods employed in the natural sciences
are not applicable to the social sciences except in limited degree .
Research is thus far more apt to be fallacious, in social than in natural
science.
Dr . L . F . Ward once said : "the knowledge how to improve human
relations can come only for the social sciences ." That statement is
' Chapter II, p . 29, quoting from The Gates Papers: A memorandum entitled "Principles of Philanthropy
as a science and Art" 1923 .
subject to serious doubt by those who believe that an understanding of

ethics, morals and fundamental principles, and an application of these,
,an do a lot to help "improve human relationships ." Those who be-
lieve that the statement of Dr . Ward is correct, often risk the safety
A our state and our society . The results of social science research
%re subject to such frequent discount or doubt, because of the possi-
bilities of error, that we can hardly afford to base changes in our forms
c)r principles of government upon them . As Professor A . H . Hobbs'
has said in his Social Problems and Scientism (p . 196) :
"* * * remember the fundamental differences between the physical sciences
and the social sciences . Physical science has a solid bed-rock of tested knowledge,
and the verified theories constitute reliable guideposts . Contrasted with this
situation, social science knowledge is an uncharted swamp . There is no solid
footing of coordinated knowledge to serve as a vantage point from which to survey
the terrain ahead . There is a labyrinth of paths leading everywhere-and
nowhere . The principles are not anchored but drift in currents of opinion ."
This Committee has been far more interested, therefore, in the
activities of the foundations in the social sciences than elsewhere .
Here the greater danger lies . Here the most grievous acts of abuse
have occured .
Foundation history has shown a rapidly increasing interest in social
science research . More and more foundation funds have been poured
into this area until, with the creation of the largest of the founda-
tions, the Ford Foundation, we see an addition of almost all its half-
billion capital devoted to the social sciences, including education .
Since the second World War, the government itself has increasingly
entered the field of social science research, giving it direct support
through research contracts from military and civilian agencies .
Today, nearly all research in the social sciences is dependent on founda-
tion grants or government contracts . The same executives and
directors who control foundation support of social science research
have been extremely active in the formulation of research policies in
the government research programs ; and a major part of the social
scientists of America are either on government payrolls or supported
by grants and contracts via universities, their research bureaus or
foundation-sponsored councils .
The foundations themselves feel that they should use their funds
within the social sciences as "risk capital", for "experiment ." Experi-
ment in the natural sciences is highly desirable . Experiment with
human beings and their mode of living and being governed is, however,
quite a different matter . If by "experiment" is meant trying to find
ways in which to make existing institutions better or better working,
that too would be admirable . If by "experiment" is meant trying
to find ways in which other political and social institutions could be
devised to supplant those we live by and are satisfied with-then such
experiment is not a desirable use of public funds expended by private
individuals without public accountability .
The inherent uncertainties of research in the social sciences, the enor-
mous factor of indefiniteness, the impossibility of truly experimenting to
test a conditional hypothesis before proclaiming it as a proven conclusion,
the grave danger of fallacious results, makes it highly questionable whether
public money should be so used to promote abandonment of institutions
and ways of life which have been found satisfactory, in favor of question-
able substitutes .
7 Assistant Professor of Sociology, University of Pennsylvania.
Some of the social scientists are very careful to state that their
conclusions are not fixed and absolute-to recognize and admit that
their research results are, at best, tentative- that no ultimate conclu-
sions can be drawn from them . Nevertheless, it is natural and in ;
evitable that others take up the results of social science research-
ignoring the uncertainty, they use the results as bases for recommend-
ing social action and even legislation . Through such a process,
fallacious conclusions (even some which the social scientists them-
selves might admit were not yet satisfactorily proven) are often
promoted for the purpose of altering the opinion of the intellectual
professions and finally the public itself . The widespread dissemina-
tion by foundations of results of social science research, among
intellectuals, teachers, writers, etc ., can itself start a propulsion toward
a demand for legislation to implement a conclusion which has no basis
in scientific fact.
The following was reported in the New York Times of May 3, 1945,
referring to a speech made by Mr . Raymond Fosdick to the Women's
Action Committee for Victory and Lasting Peace :
"Mr . Raymond Fosdick, president of the Rockefeller Foundation, warned 300
members representing 38 States that the growing distrust of Russia menaced the
future of world peace ."
This was brought out in the testimony of Alfred Kohlberg before the
Cox Committee, after which Mr . Kohlberg made these apt remarks :
"Now, I am bringing these names up because these gentlemen are beyond
question in their loyalty and patriotism, you see ; but somebody has twisted their
mental processes .
"They paid out millions of dollars for so-called research in foreign policy, and it
seems that the result of that research has come back and twisted their mental processes
so that Mr. Fosdick warns that `The growing distrust of Russia menaces the future
of world peace,' prior to VE day .
"Of course, if we had had just a little distrust of Russia at that time, we might
not have turned over Eastern Europe and China to them ." [Emphasis ours .]
Mr. Kohlberg, whose testimony before the Cox Committee is well
worth study, also brought out that, according to the New York Times
of December 29, 1950, Prof . Robert C . North, speaking at the opening
of the annual convention of the American Historical Society (heavily
supported by foundations) had said "that the United States has been
on the wrong side of the Asian revolution this far ." That, as Mr .
Kohlberg pointed out, was after `the Chinese Communists had entered
the Korean War against us .
Mr. Kohlberg also noted that Prof . North and one Harold R . Isaacs
had travelled around the United States making a survey for the Ford
Foundation, as a result of which that foundation granted " * * * I
think, $250,000 to the Council of Learned Societies to carry on the
recommendations of these two gentlemen who have this kind of
opinion. * * * "
Can we afford to take the risks involved in permitting privately
managed foundations to expend public funds in areas which could
endanger our national safety? Officers of some of the foundations
frequently assert that they must take risks to do their work effectively .
But risks with the public welfare had better be taken by the Congress
and not by private individuals, many of whom appear too busy with
their own affairs to pay close attention to what the foundation, which
they in theory manage, is doing .
PATRONAGE AND CONTROL .

The power of money is obvious enough. The huge funds controlled
by the great foundations involve patronage to banks, investment
houses, law firms and others . Through their holdings of securities
and purchasing power they exercise additional influence . Appoint-
ment to the board of one of the larger foundations is considered
something of a public honor . Accordingly, by selecting strategically-
placed trustees who welcome appointment, a foundation can extend
its power and its influence . The presence of Arthur__Ha s Sulz-
berger, President and publisher of the New York Times, on t e Toard
of the Rocke e ndation is ari U14_sti_ ation of this extension of
power and intluence .x We do not mean to imply that Mr . Sulz-
berger directed his editors to slant their reporting on this Committee's
work, but his very presence on the Rockefeller Foundation Board could
have been an indirect, intangible, influencing factor . At any rate, the
Times has bowed to no other newspaper in the vindictiveness of its
attacks on this Committee . In its issue of August 5, 1954, it gave
856 lines of laudatory columnar space, starting with a front-page arti-
cle, to the statement filed by the Rockefeller Foundation . The following
day, August 6, 1954, appeared one of a succession of bitter editorials
attacking this Committee .
Some of the foundations go so far as to engage high grade and
expensive "public relations counsellors" to cement their power and
influence . This strikes us as a dubious use of public money . Through
such counsellors, more than ordinary influence on the press and other
media of public communication can be exerted .
These are only some of the ramifications of the colossal power
which large foundations possess . In some instances their influence
is amplified by the power of great corporations with which they are
associated through large stock holdings or through interlocking direc-
torships . Examples of this would be the Ford Foundation and the
Rockefeller Foundations .
A great foundation can often exercise heavy influence over a college
or university, sometimes to the extent of suborning it to its own ends .
The privately-financed institutions of higher learning have had a
distressing time ; the inflation of the past decade or so has increased
to the point of desperation the problem of keeping a college going .
In these circumstances, foundation grants are so important a source
of support that it is not uncommon for university or college presidents
to hang upon the wishes of the executives who distribute the largess
for foundations . Most college presidents will frankly admit that
they dislike receiving restricted or labelled grants from foundations-
that they would much prefer direct and unrestricted grants to their
institutions ; or, if a purpose must be attached to the grant, that the
university be permitted to construct and direct the study as it wishes .
But they will also admit that they hesitate to turn down any grant,
however restricted, from a great foundation . After all, if they get
on the wrong side of these sources of support they may be stricken
from the list of beneficiaries .
As academic opinion today is the opinion of the intellectuals of
tomorrow and will very likely be reflected into legislation and in
public affairs thereafter, the opportunities available to the founda-
8 Mr . Sulzberger is also on the boards of several other foundations .
tions to influence the course of society through grants to institutions

of higher learning are far reaching . That such influence has been
exerted is beyond question .
In reply to the question : had the foundations been able to channel
thinking down one narrow channel?, Professor David N . Rowe of
Yale answered that "efforts to that end had been made ." He then
testified to an astounding example of a foundation attempting to
exercise control of a university function in a most radical manner .
His testimony ran :
* * * The effort to influence the content of area programs at Yale has been
made by at least one foundation that I know of, namely, the Carnegie Corporation .
I can't give you the precise date of this, but I would judge it was in about 1947 . I
think that isn't too much to say that this incident is rather typical of some types
of foundation activity that are going on today . I don't pretend to know how
constant they are or how general they are around the country .
This involved an effort on the part of the Carnegie Corporation through one
of its representatives by the name of John Gardner, I believe, to influence the
administration of Yale to eliminate the work we were doing in the far-eastern
field and to concentrate our work on the southeast Asian field . This was a
rather surprising suggestion . Yale has a long tradition of interest in the Far
East . You may have heard of the organization known as Yale in China .
At the time this suggestion was made, we were spending a considerable sum
of money each year on faculty salaries for teaching and research in the far-eastern
field .
Mr . HAYS . What year was this, sir?
Dr . RowE . I think it was about 1947 . I can't give you the precise date .
Mr . HAYS . Just so we get some idea .
Dr . ROWE . Yes . This had to do with the desire on the part of Yale to develop
and expand its work in the southeast Asian field, where again we had important
work for a number of years . We have had some eminent people in the southeast
Asian field for years in the past.
In this connection, the visit of Mr. Gardner to the university was undertaken,
I believe, at that time the dean of Yale College was in charge of the whole
foreign area program, and I was working directly under him as director of grad-
uate and undergraduate studies as the biography indicated . We were rather
shocked at Mr . Gardner's suggestion that we drop all our work on the Far East
and concentrate on southeast Asia .
The dean questioned Mr . Gardner as to why this suggestion was being made.
In the general conversation that followed-I got this second hand from the
dean, because I was not present then-the philosophy of the foundations along
this line was brought out . They look upon their funds or tend to look upon
their funds as being expendable with the greatest possible economy . That is
natural. They look upon the resources in these fields where the people are few
and far between as scarce, which is correct, and they are interested in integrating
and coordinating the study of these subjects in this country . Therefore, the
suggestion that we cut out far-eastern studies seemed to be based on a notion
on their part that no one university should attempt to cover too many different
fields at one time .
The practical obstacles in the way of following the suggestion made by Mr .
Gardner at that time were pretty clear . There were quite a few of the members
of the staff on the far-eastern studies at that time who were already on permanent
faculty tenure at Yale and could hardly have been moved around at the volition
of the university, even if it had wanted to do it . The investment in library
resources and other fixed items of that kind was very large . The suggestion that
we just liquidate all this in order to concentrate on southeast Asian studies, even
though it was accompanied by a suggestion that if this kind of a policy was
adopted, the Carnegie Corporation would be willing to subsidize pretty heavily
the development of southeast Asian studies, was met by a flat refusal on the
part of the university administration .
Subsequently the dean asked me to write the initial memorandum for submis-
sion to the Carnegie Corporation on the basis of which, without acceding to their
suggestion that we eliminate far eastern studies from our curriculum, that we
wanted to expand our southeast Asian studies with their funds .

They subsequently did give us a grant for this purpose, and they have given a
second grant. I don't know precisely what the amounts were in either case.
The only reason for my giving you this incident in somewhat detail is to indicate
what I consider to he a real tendency in foundations today-in some foundations,
not all-to adopt a function of trying to rationalize higher education and research
in this country along the lines of the greatest so-called efficiency . I used the
word "so-called" there designedly, because in my view, the notion that educational
and research and scholarly efficiency can be produced this way in a democratic
society is unacceptable. It seems to me that in a democratic society we have to
strive for the greatest possible varigation and differentiation as between univer-
sities along these lines, and the suggestion that any one university should more or
less monopolize one field or any few universities monopolize one field, and give
the other fields to others to do likewise with, it is personally repugnant to me .
It does not jibe with my notion of academic freedom in the kind of democratic
society that I believe in . (Hearings, pp . 527, 528.)
This incident at Yale strikes this Committee as appalling. Any
attempts by foundations, or concentrations of foundation power, to control
research in the universities and colleges and to create conformity, uni-
formity or foundation-policed research should receive from Congress and
the public the censure it well merits .
On the subject of conformity, Professor Rowe testified as follows :
* * *
In the academic field, of course, we have what is known as academic tenure or
faculty tenure . After they get permanent tenure in a university, providing they
don't stray off the beaten path too far from an ethical point of view, people can
say almost anything they want. I have never felt that any of my colleagues
should be afraid to express their opinions on any subject, as long as they stay
within the bounds of good taste and ordinary common decency . Nobody in the
world is going to be able to do anything to them . This is fact and not fiction .
It is not fancy. Their degree of security is put there to be exploited in this way .
Now, of course, some of the people that complain most bitterly about the
invasion of academic privilege along that line are those who indulge themselves
invading it . What, for instance, is a professor to think when people with money
come along and tell his university that what he is doing there is useless and ought
to be liquidated, because it is being done much better some place else?
We hear a lot of the use of the word "conformity" nowadays, that congressional
investigations are trying to induce conformity . The inducement of conformity
by the use of power is as old as the human race, and I doubt if it is going to be
ended in a short time . But one of the purposes of having academic institutions
which are on a private basis is to maximize the security of individuals who will
refuse to knuckle under to the pressures of money or opinion or anything of that
kind. This problem is always going to be with us, because anybody that has
money wants to use it, and he wants to use it to advance what he considers to be
his interests . In doing so, he is bound to come up against contrary opinions of
people who don't have that much money and that much power and whose only
security lies in our system, whereby academic personnel are given security in
tenure, no matter what their opinions are within the framework of public accept-
ability and security, to say what they want and do what they please, without
being integrated by anybody .
Mr . WORMSEa . Professor, this committee in some of the newspapers has been
criticized in just that area. It has been said that it tended to promote conformity
and exercise thought control or censorships . That of course is far from its
intention .
I wonder if I gather from your remarks correctly you think that the foundations
to some extent have tended to do just that?
Dr. RowE. I would say that there are examples of foundations trying to engage
in controlling the course of academic research and teaching by the use of their
funds . As to whether this is a general tendency in all foundations, I would be
very much surprised if that were so . But if this committee can illuminate any
and all cases in which the power of foundations, which is immense, has been used
in such a way as to impinge upon the complete freedom of the intellectual com-
munity to do what it wants in its own area, I should think it would be rendering
a tremendous public service .
I am not prejudicing the result . I don't know whether you are going to prove
any of this or not . But the investigation of this subject is to me not only highly
justifiable, but it is highly desirable in an age when we are confronted adl around
in the environment in which we live with illustrations of how great power can be
concentrated and used to prevent the normal amount of differentiation and
variation from individual to individual, university to university, and college to
college . The totalitarian societies, of course, have none of this freedom in the
intellectual field . (Hearings, pp . 532, 533 .)
The control exerciseable by the great foundations through their
patronage goes far deeper than the upper level of institutional man-
agement . For most academicians the route of foundation grants is
the only one available for success in their professions . Moreover,
badly paid as most of them are, it is generally only through foundation
grants that their income can be amplified to a reasonable standard .
The pressure starts at the very bottom of the academic ladder .
Instances of it have come to our attention but we shall not specify
them for fear of injuring the reputations or hampering the careers of
those who have succumbed to the temptation put before them by
foundation funds . A foundation grant may enable a neophyte to reach
that all-important doctor's degree through support of his graduate
studies . If it seems necessary to conform to what he may think is
the point of view promoted by a foundation which might honor him .
with its grace, is it unnatural that he conform? When he becomes a
teacher, a foundation grant may supplement his meager salary ; will
he reject a grant because he does not like its possible objective?
Foundations may finance a study leading to a book which will advance
his standing and prestige in his medium, the bases for academic ad-
vancement . Is he likely to do a study that the foundation would find
undesirable? Is it likely, indeed, to make the grant if it is not satisfied
the recipient will comply with any predilections it may have? We do
not mean to assert that all foundations impose conditions of con-
formity on all grantees . We point out merely that the power to do so
is there, and that this power has been used . Some foundations set
up more or less elaborate machinery for the selection of grantees, such
as committees to sift the applicants . But control can be exercised as
well through such machinery, by carefully selecting the committees
or other human agencies .
A foundation may send the grantee to a foreign country to increase
his knowledge and prestige . It may even accept his research proposal
and set him up in business b making his proposal a project in one
of its favored universities . A research organization may be set up
under his direction . A foundation may recommend him to a uni-
versity for a teaching vacancy . He may even come to be recom-
mended by the foundation for the presidency of some college or
university.
Will any of these lifts come to the academician if he does not
conform to whatever predilections or prejudices the foundation bureau-
crats may have? Perhaps-but the academician cannot often afford
the risk. Just as the president of the institution, whose main job
today may well be fund-raising, cannot afford to ignore the bureau-
crats' wishes, so the academician cannot . Scholars and fund-raisers
both soon learn to study the predilections, preferences and aversions
of foundations' executives, and benefit from such knowledge by pre-
senting projects likely to please them .
THE FOUNDATION BUREAUCRATS .

These executives are not generally the trustees of the foundations .
The trustees, estimable citizens though they may be, do not spend
the time necessary to engage in the intimate and frequent contact
which is necessary in the actual making of grant-decisions . The
executives, those who truly have the say, those to whom this right
is delegated by the large foundation's board of trustees, are the pro-
fessional managers of foundation enterprises . Thus, it often becomes
a matter of one foundation-employed individual impressing his
opinions and his predilections and his aversions on an institution or
an individual recipient of a grant . Whatever methods of clearing
grants may exist within a given foundation, it is frequently, in the
last analysis, the decision of one man which prevails .
In a letter of October 1, 1953 addressed to the Chairman of this
Committee, Professor Kenneth Colgrove said :
"In the aggregate, the officers of these foundations' wield a staggering sum of
influence and direction upon research, education and propaganda in the United
States and even in foreign countries ."
In a letter of August 4, 1951, J . Fred Rippey, Professor of American
History at University of Chicago, writing to the late Honorable E . E,
Cox, later Chairman of the Cox Committee, said :
"At present and for years to come, scholars in our universities will not be able
to do much research on . their own because of high prices and heavy taxes . The
recipients of these tax free subsidies from the foundations will therefcre have
great advantages that will be denied the rest of the university staffs . The
favored few will get the promotions and rise to prominence . The others will tend
to sink into obscurity and have little influence in the promotion of ideas and cul-
ture . Unless the power to distribute these immense foundation funds is decentral-
ized, the little controlling committees and those to whom they award grants and
other favors will practically dominate every field of higher education in the
United States . Even granting them great wisdom and patriotism, one might still
complain against this injury to the great principle of equality of opportunity .
But I have never been impressed by the superior wisdom of the foundation heads
and executive committees . The heads tend to become arrogant ; the members of
the committees are, as a rule, far from the ablest scholars in this country ."
The bureaucrats of the foundations have become a powerful group
indeed . Not only do they, more often than the trustees of foundations,
determine grants and grantees, but they exert an influence on academic
life second to no other group in our society . They become advisers to
government in matters of science . They are often consulted before
the selection of teachers in universities . They serve on international
bodies for the United States Government . They become virtual
symbols of prestige, responsible only to a small group of foundation
trustees who have come to follow their views . The fact is that those
who control the great foundations possess opportunities for patronage
which in some ways may exceed anything which the elected officials of
government have to distribute .
The professionals, who exert so important an influence upon thought
and public opinion in the United States, form a sort of professional
class, an elite of management of the vast public funds available to
their will . Thev can scarcely avoid getting an exaggerated idea of
their own importance and becoming preoccupied with holding and
enlarging their roles .

That this leads to arrogance was established by Prof . Briggs in

testifying regarding the Ford Fund for the Advancement of Education :
I charge that the present officers of the Fund for the Advancement of Education
have arrogated to themselves an assumption of omniscience, which responsibility
for distributing millions of donated dollars does not automatically bestow, nor
does it bestow a becoming humility and respect for the judgment of others .
* * * * * * *
* * * Whenever foundation officers, subordinate as well as chief, 'confuse
position with ability and power with wisdom, losing the humility that would
keep ears and mind hospitably open to what others think, the welfare of the
general public is endangered .
It can hardly be wondered at that the officers of a foundation steadily tend, as
Dr . Keppel once said, toward "an illusion of omniscience or omnipotence ." Even
a chauffeur feels that the powerful engine in the car that he is hired to drive
increases his importance, is in a sense his own personal power . (Hearings, p . 97.)
The place of foundations in our culture cannot be understood
without a recognition of the emergence of this special class in our
society, the professional managers of foundations . They are highly
paid ; they ordinarily have job security . They acquire great prestige
through their offices and the power they wield . They disburse vast
sums of money with but moderate control, frequently with virtually
no supervision . Their hackles rise at any criticism of the system by
which they prosper . More often than not, the power of the foundation
is their power. They like things as they are .
CRITICISM AND DEFENSE.
In the light of the power of the foundations, it is not surprising that
the vocal critics of foundations are comparatively small in number .
Professor Briggs made the reasons clear in testifying regarding his
resignation from the Advisory Board of the Ford Fund for the Advance-
ment of Education :
Especially disturbing in a large number of the responses to my letter of resig-
nation was the fear, often expressed and always implied, of making criticisms of
the fund lest they prejudice the chances of the institution represented by the critic
or of some project favored by him of getting financial aid from the fund at some
future time .
It is tragic in a high degree that men who have won confidence and position in
the educational world should be intimidated from expressing criticism of a founda-
tion whose administrators and policies they do not respect . (Hearings, p . 97 .)
Prof . Briggs continued :
It has been stated that, unlike colleges and universities, foundations have no
alumni to defend them . But they do have influential people as members of their
boards, and these membr .rs have powerful friends, some of whom are more inclined
to oe partisanly defensive than objectively critical . Moreover, there are also
thousands who, hopeful of becoming beneficiaries of future grants, either con-
ceal their criticisms or else give expression to a defense that may not be wholly
sincere . (Hearings, pp . 101, 102 .) [Emphasis ours .l
The abuse which has been heaped upon this Committee and its staff
for daring to consider serious criticisms of foundation management and
operation well illustrates that some of the foundations do, indeed, have
"influential people" on their boards and very "powerful friends" who
are "partisanly defensive ."
VII . THE CONCENTRATION OF POWER-THE INTERLOCKS

THE HAZARDS TO SOCIETY IN AN INTERLOCK.
Social scientists have been articulate in presenting the theory that
concentration of Economic Power is a threat to the American sys-
tem . The Temporary National Economic Committee during the
years 1938 to 1940 devoted a great deal of effort to the study of the
patterns of influence resulting from interlocking directorates, from
voluntary associations of business, from growth tendencies in indus-
try. The tradition of American Federal legislation is one of suspicion
against any accumulation of power which enables a group of citizens
to control economic and social aspects of our life . We have a con-
sistent record of regulatory laws meant to prevent domination of
important aspects of our social life by private powers outside of the
system of checks and balances established by our Constitution . The
anti-trust laws, the Federal Trade Commission, the Federal super-
vision of communications and of transportation serve to protect society
against concentration of power . The existence of excessive power free
from control by the administrative and judicial processes is contrary
to the principle of free competition . The American system combats
monopolism . The Supreme Court in recent decisions declared that
not only actual collusions in restraint of competition, but the very
existence of power to restrain competition, warrants remedial action .
Whatever dangers to society may exist in the great power which the
large tax exempt foundations possess as individual units are multiplied
to the point of enormous hazard if numbers of these colossi combine
together . If some of these great foundations have acted together or
are closely connected in operation, through interlocking directorates,
interchanging administrative personnel and the use of intermediary
organizations commonly supported, it may be necessary that we con-
sider protecting ourselves against such a combine in the foundation
world just as we would if it existed in the business world .
DOES A CONCENTRATION OF POWER EXIST?
It is the conclusion of this Committee that such a combine does
exist and that its impact upon our society is that of an intellectual
cartel . The statement filed with the Committee by the American
Council of Learned Societies is typical of the generality of the founda-
tions in emphatically denying the existence of a "conspiracy" among
the operating organizations and the foundations . This Committee
does not see any evidence that the concentration of power arose as the
result of a "conspiracy" . It has not been created as the result of a
plot by a single group of identifiable individuals . It has not been
"created" at all, in the sense of a conscious plan having been worked
out in advance to construct and implement its essentials . It has, how-
ever, happened . Any informed observer would so conclude . Charles
S. Hyneman, for example, a Professor of Political Science at North-
western University and a firm friend of the foundations, in a letter to
Committee Counsel, dated July 22, 1954, wrote :
"I have always supposed that there is indeed a 'close interlock or a concentra-
tion of power' between the foundations on the one hand and the so-called learned
societies, such as the Social Science Research Council and the American Council of
Learned Societies, on the other hand ." 9
9 See Appendix to Hea, ings .
The concentration has happened . And it is something as definite to

reckon with as though it had, in fact, been consciously created . Its
looseness of organization, its incomplete integration, its lack of .formality,
the inability to put a finger on all the exact mechanics of its connected
operation, does not detract from its reality or from the dangers which it
potentially carries . Even were its conduct simon-pure, such a con-
centration of power would, in essence, be un-American and undesirable .
And the fact seems to be that it has not always worked to the benefit
of the Nation .
Some of the foundations have fallen into a system or habit of working
together, with each other and with the foundation-supported inter-
mediary organizations which all exhibit most clearly that an interlock
exists . It has been perhaps a convenience, and it is readily under-
standable how this could have developed without the trustees of
foundations being conscious of the dangers this system involved .
Most of them would probably be unable to recognize that a combine
actually exists : its coordination and the integration of its parts result
from executive action rather than from trustee direction .
Those who support this aggregation of power, and they are many,
assert that its personnel comprises, for the most part, the persons
most qualified in their respective fields of research, research direction,
teaching and writing . They say, further, that this close association
is both natural and desirable . But who is to judge whether this
group is the truly elite? If it has the services of most of those social
scientists who are eminent, is this because they are deservedly so or
perhaps because the group has often closed its doors to those of
contrary opinion or made it difficult for those of different approach to
rise in their metiers?
We cannot possibly determine the cause-effect relationship be-
tween influence and scientific prestige . There are some strong indi-
cations, however, that scientific prestige is frequently the result
rather than the cause of an appointment as an executive or a director
of a foundation or a scientific council . The monetary power, the
ability to supply jobs and research funds, has made many a man a
presumed authority in the social sciences, although he started out
with only modest knowledge in the area . In the last analysis, it is
these executives who are the effective "elite ." And even if it should
be true that most of the "best minds" are in the group, do we wish
to permit them virtual control of intellectual direction in our country?
It smacks somewhat of the once-proposed "managerial revolution ."
That the development of research and the consequent moulding of public
opinion in the United States should lie in the hands of any dominating
group seems contrary indeed to our concepts of freedom and competition .
Assuming for the sake of argument (though it is subject to con-
siderable doubt) that the presently guiding group has superiority,
how can society be sure that it will maintain this superiority? Will
it receive or open its ranks to contrary opinion? Will it permit
entry to younger men who do not agree with its thesis? Will the
group truly be the guardians of scientific objectivity, or become
propagandists for that in which they happen to believe?
The risk is great . It is so easy for such a group, wielding the power
which the support of the great foundations gives it, to become a bulwark
against freedom of inquiry and freedom of instruction . Power does corrupt .
Nor are the wielders of power always aware that their power is corroding
their judgment .
There is the further risk that a few of the major foundations, those
which contribute the principal support of the intermediary organiza-
tions through which the concentration, the intellectual cartel, largely
operates, could come to exercise direct and complete control over the
combine through the power of the purse, with all the far-reaching
consequences of such control . The aggregate power, for example, of
the Ford, Rockefeller and Carnegie funds, coming into the managerial
hands of like-minded persons, might result in the complete domination
of the intellectual life of the country .
Is this far-fetched? Foundations now controlled by admirable men
of public interest could easily come into the control of others with
political axes to grind . It has happened . The Institute of Pacific
Relations was one of the "clearing house" organizations, supported
to the extent of millions of dollars by the Rockefeller and Carnegie
foundations and others . It came under the control of Communists
and their sympathizers, with the result that it had tragically much to
do with the loss of China to the Communists . This ghastly example of
how dangerous reliance on an intermediary organization can be, must not
be easily forgotten . It should be ever present in the minds of foundation
trustees to caution them against readily escaping their fiduciary obligation
to see to the proper use of the public money they dispense, by handing it to
others to do their work for them .
An Institute of Pacific Relations could happen again! Indeed, it is a
conclusion of this Committee that the trustees of some of the major
foundations have on numerous important occasions been beguiled by
truly subversive influences . Without many of their trustees having
the remotest idea of what has happened, these foundations have fre-
quently been put substantially to uses which have adversely affected
the best interests of the United States . From the statements which
they have filed with this Committee, we cannot agree that they have
disproved this contention, nor that they have satisfied what is prob-
ably a fair affirmative burden to place upon their shoulders . That
burden is to show, to demonstrate, that they have made strong, posi-
tive contributions to offset the baleful influences which they have
sometimes underwritten through their financial power . These in-
fluences we shall discuss in some detail in subsequent sections of this
report .
It is our opinion that the concentration of power has taken away
much of the safety which independent foundation operation should
rovide ; that this concentration has been used to undermine many of
our most precious institutions, and to promote radical change in the
p
form of our government and our society .
THE CARTEL AND ITS OPERATIONS .
Numbers of professors in the social sciences have pointed out the
existence of an interlock, a cartel .
In testifying before the McCarran Committee (pp . 4023-27),
Professor Rowe of Yale was asked by Counsel :
"Do you know anything, Professor, of the general tendency, to integrate studies
and to brine about unanimity of agreement on any particular subject, with the
foundations . "
This question led to the following testimony which seems to us
important and revealing :
"Mr. RowE . Well, let's take a possible hypothetical case . Let's assume that
organization A wants to promote point of view B and they get money from founda-
C5647-54 4
tion C and allocate it to a lot of people . They want to have a place for these
people to work . They want to maintain them . So they send them around to
universities like Yale, Columbia, and California, three I have mentioned where
this actually happened, you see . And they hold the final strings.
"Now, of course, in the interests supposedly of efficiency, integration, coordination,
and all these shibboleths of the American foundation point of view, maybe this is a
good thing. From my point of view, the foundations and these research organizations
like the Institute of Pacific Relations have gone hog wild on the coordination of research .
They have committed themselves so thoroughly to coordination of research that in fact
instead of supporting a great variety of research projects, which would enrich the
American intellectual scene through variegation, which is a value I very basically
believe in, you have a narrowing of emphasis, a concentration of power, a concentra-
tion of authority, and an impoverishment of the American intellectual scene .
"These people like organization . They like to have a man in a university, for
example, who will take the responsibility for organizing research around a narrow
topic . This means he acquires a staff, and you go to work on a special project.
You may spend $250,000 or $500,000 working on some narrow field, which may or
may not ever yield you any results .
"If I were doing the thing, I would talk in terms of supporting individual
scholars, and not in terms of supporting these highly organization concentrated
narrow specialized iesearch projects that are supported in some of the universities .
"Now, as I said, I am off on a hobbyhorse at this point . But it is of particular
inter - st, because by exercising power over research in this way, you see, by insisting
on the integration of research activity, anybody who wants to, can control the results
of research in American universities . And I think this is a very questionable business
that the public ought to look at very, very closely, and see whether they want a few
monopolies of the money, like, for instance, the Rockefeller Foundation, the Carnegie
Corp .,-who have done immense amounts of good, to emphasize narrow concentration
to the extent that they have .
"Mr . MORRIS . Well, can you think of a particular example of how this would
be applied, Professor?
"Mr . RowE . Well, I can cite cases in which I think this method has been over-
done, this kind of an approach has been overdone, cases in which a quarter of a
million dollars is allocated over a 10-year period for research on a narrow topic
in Chinese history, let's say, in which the graduate students who come into this
field in that university are pushed into confining their research to this narrow
field so as to contribute to it ; where the personnel drawn into the university is
drawn into this framework ; and where, as a result, the broad general interest in
the whole field of Chinese history is made difficult to maintain . All this is done
in the interest of efficiency, you know, the great American shibboleth .
"I often say that if we try to become as efficient as the really efficient, sup-
posedly, people, the dictators, then we destroy American scholarship and every-
thing that it stands for . And I often wonder whether my colleagues realize
who won the last war . Intellectually speaking, this country has a great danger of
intellectually trying to imitate the totalitarian approach, in allowing people at centers
of financial power-they aren't political powers in this sense-to tell the public
what to study and what to work on, and to set up a framework .
"Now, of course, as you know, scholars like freedom . Maybe they come up
with a lot of useless information . But in my value standard, as soon as we dimin-
ish the free exercise of unhampered curiosity, free curiosity, by channeling our
efforts along this line, we then destroy the American mentality . Because the
great feature of the American mentality is the belief in allowing people to rush
off in all kinds of different directions at once . Because we don't know what is
absolutely right . You can't tell that far in advance .
"If I may just continue one moment more, Senator, I would like to point out
to you that Adolf Hitler very effectively crippled atomic research in Germany by
telling the physicists what he wanted them to come up with . Now, this is true .
And if you can do that in atomic physics, you can do it 10 times as fast in the
so-called social sciences, which really aren't sciences at all, where really opinion,
differentiation of opinion, is the thing that matters and what we stand for in this
country .
"That is why I become very much inflamed when I even smell the first hint of a
combination in restraint of trade in the intellectual sphere.
"Now, you see what I am talking about with this interlocking directorate? That
is what bothers me about it . I don't mind if the boys go off and have a club of their
own . That is their own business . But when you get a tie-in of money, a tie-in of
the promotion of monographs, a tie-in of research, and a tie-in of publication, then
1 say that the intellectuals are having the reins put on them and blinders .
"Senator WATKINS. Otherwise, they do not get on the team .

"Mr . Rowj . That is right. They don't get on the team, and they don't
get a chance to carry the ball .
"Now to the faculty member, this means money, income, what he lives on . It
is vital. It is not just some recreational thing, you see .
"Senator WATKINS . What I wanted to ask you was this : As a matter of
practice, is it not true that in graduate schools of most of our American universities
and colleges, the head of the department usually pretty well dictates to the young
man who is working for his Ph . D . or master of arts what he is going to write
about or what field he is going to investigate?
"Mr . RowE . No, Sir, Senator, not in any department I have ever been con-
nected with. The student is in an open market, where he can go and buy the
specialty that any professor has got to offer .
"Senator WATKINS . It has to be approved, though .
"Mr . RowE . Oh, yes. It has to be approved . But remember this. At this
point, you get into the activities of the club . And this is one of the ways in
which the individual has a chance to assert himself, because, as you know, if
Mr . X doesn't approve of Mr . Y's project, then Mr. Y doesn't have to approve
his project . I mean, there is a trade back and forth business .
"Senator WATKINS . There is an interlocking group .
"Mr. RowE . In the interlocking group it is a different business . This has to
do with monopoly of funds and support for research work in the large . I am
not talking now about students and dissertations and things of that sort.
"Senator WATKINS . This is more or less research when the student is taking
his work for his Ph.D . and he has to write his dissertation .
"Mr. RowE . But you see actually, Senator, the only place I know of where
all students in the field of ahinese history are integrated into the study of one
15-year period of Chinese history, is in connection with one of these research
projects .
"That is the only case in the United States that I know of . I have never seen
it operate any place else .
"This kind of thing is supported by foundation money . And, of course, the tempta-
tion is to bring everybody in and integrate, through a genteel process of bribery . That
is to say, you support the student, you give him a fellowship, if he will buy your subject
matter area . And if you do this for 15 years, the only Ph .D .'s you turn out will
be people who know that 12-year period or 15-year period of Chinese history .
I say this is intellectual impoverishment .
"Senator WATKINS. You think that is not true, however, elsewhere?
"Mr . RowE. It is not generally true.
"Senator WATKINS . I hope it is not, because I thought maybe it might be in
some universities I know about.
"Mr . RowE . It is not generally true, but it is the inevitable kind of thing which
happens with this hot pursuit of efficiency, integration . And, of course, remember
this . The foundation people have to have jobs . They have to have something to
administer . They don't want to give away the money to the universities and say
`Go ahead and spend it any way you want .' They want to see that the activity pays .
That is, we have got to have a regular flow of the so-called materials of research
coming out . We want to see this flow in certain quantity . It has to have a certain
weight in the hand. And to see that this happens, we do not just give it to a university
where they are going to allow any Tom, Dick and Harry of a professor to do his own
thing. `No, we want an integration .'
"As ;warned, Mr . Morris, you see-he set me off, here .
"Senator WATKINS . I take it that is a pretty good plea for the university as
against the foundation .
"Mr. RowE . Absolutely . And, as a matter of fact, I couldn't find a better
illustration of the dangers of consistently over the years donating very large sums of
money to organizations, you see, for research purposes, than is involved in the very
Institute of Pacific Relations itself . It is a fine illustration of the fact that power
corrupts, and the more power you get the more corrupt you get .
"Mr . ROBERT MORRIS (Special Counsel) . Was any inducement ever made to
you in connection with your membership in the Institute of Pacific Relations that
would indicate it would be favorable to you-
"Mr . RowE . Well, I would say this . I was indoctrinated at some point in
my education with a general distaste for joining many organizations . I have a
feeling I got this from my former professor of politics at Princeton, Prof . William
Starr Myers. But wherever I got it, it is a fact . And when I first came back
from China and entered into my first academic job in Princeton in 1938, I re-
frained
"I wasfrom joining the
andInstitute
invited, of Pacific Relations . joining
approached but,I refrained from . And I will say
that the only reason I ever did join was on account of a letter I got from Mr . Lock-
wood, who was then in the organization, the general tenor of which was that young
people just starting out in the far eastern field are `well advised to become a mem-
ber of this organization .' It was a very genteel statement, but the meaning of it
was quite obvious . And I joined only because I got that letter . It is the sort
of letter that a young man beginning in a profession can hardly afford to disregard .
Five dollars a year to protect yourself? O . K . You pay . You join . That is
the"Ionly
laterinterest I had in
got involved at the
the organization,
time . and as I told you this morning became
a member of the board of trustees in 1947 . But in 1938, well, $5 was pretty
important to me in those days . On a salary of $2,000 a year, I didn't join more
organizations than I had to ." [Emphasis ours .]
The Committee is well aware that a parade of professors in the
social sciences could be marshalled who would deny that a concentra-
tion of power exists, who would assert that the great foundations act
independently, sagely and objectively throughout their work . We
are inclined, however, to listen carefully to the voices raised by
courageous, qualified critics in the profession . Professor Rowe, for
example, had no axe to grind . He is an academician of eminence and
exceptional ability who is friendly to foundations and by his own
testimony has enjoyed grants from them . It does take courage to
critcise the foundations whose benefactions are so important to
academicians, both financially and professionally . The system is
very likely to punish its critics, as it has, in instances, certainly done .
In this letter of August 4, 1951, to Congressman Cox, previously
referred to,10 Professor Rippy stated that he had never been impressed
with the great wisdom of foundation executives . He said they tended
to be arrogant, and that members of the distributing committees are
as a rule far from the best scholars . He recommended decentraliza-
tion of control of the use of funds, suggesting the democratic progress
of selection through faculty committees in the universities-"In
numbers there will be more wisdom and justice ." He continued :
"I believe our way of lifelis based upon the principles of local autonomy and
equality of opportunity . I strongly approve those principles and I believe you
do likewise . I should not be surprised if your proposed committee of investiga-
tion should discover that concentration of power, favoritism, and inefficient use
of funds are the worst evils that may be attributed to the Foundations ."
In a second letter to the Chairman of the Cox Committee on
November 8, 1952, Professor Rippy wrote as follows (Hearings, p . 62) :
DEAR CONGRESSMAN Cox : Since I wrote you on August 4, 1951, Dr . Abraham
Flexner, a man who has had much experience with the foundations, has pub-
lished a book entitled "Funds and Foundations," in which he expresses views
similar to those contained in my letter . I call your attention to the following
pages of Flexner's volume : 84, 92, 94, 124, and 125 . Here Dr. Flexner denies
that the foundation staffs had the capacity to pass wisely on the numerous
projects and individuals for which and to which grants were made, and contends
that the grants should have been made to universities as contributions to their
endowments for research and other purposes .
The problem is clearly one of the concentration of power in hands that could
not possibly be competent to perform the enormous task which the small staffs
had the presumption to undertake . This, says Flexner, was both "pretentious"
and "absurd ." In my opinion, it was worse than that . The staffs were guilty
of favoritism . The small committees who passed on the grants for projects
and to individuals were dominated by small coteries connected with certain
eastern universities . A committee on Latin American studies, set up in the
10 Supra, p . 37 .
1940's for instance, was filled with Harvard graduates . A single professor of
history on the Harvard faculty had the decisive word regarding every request
for aid presented by historians .
By granting these subsidies to favorite individuals and favored ideas, the
foundations contribute to inequalities in opportunity and interfere with "free
trade and ideas ." They increase the power of favored groups to dominate our
colleges and universities . Men whose power exceeds their wisdom, or men who
are not guided by the principle of equality of opportunity, could become a menace .
If possible, under the terms of our Federal Constitution, these foundations should
either be taxed out of existence or compelled to make their grants to colleges
and universities, to be distributed by faculty committees of these institutions .
Evenhanded justice may not prevail even then because such justice is rarely
achieved in human relations . But a greater approximation to evenhanded jus-
tice will be made because these local committees will have more intimate knowl-
edge of recipients . This, as you know, is the fundamental justification for
decentralization of power, for the local autonomy which was so prominent in
the thinking of our Founding Fathers .
Interlocks in 'commercial enterprises have been studied frequently
enough, and an analogy is apt . In monograph ii Bureaucracy and
Trusteeship in Large Corporations, TNEC, the problem of interlocking
directorships is explained as follows :
"The existence of interlocking directorships is not conclusive proof that the
companies involved work in close harmony . Some directors in reality have
little to say about management, either because they are relatively inactive, or
because they are members of the minority, or, perhaps most common of all,
because the officers of the particular companies run their enterprises without
substantive assistance from their boards . Nevertheless, many directors are
influential and in any case there can be little doubt that interlockings at least con-
tribute substantially to the so-called climate of opinion, within which policies are
determined . Moreover the majority of those who hold the most directorships
among the largest corporations also have active positions in at least one of the
companies they serve. It is possible that `such men are likely to take a respon-
sible share in the development of policy in any corporation in which they hold a
responsible position .' " [Emphasis ours.]
Among tax exempt educational and charitable organizations there
exists a pattern of relationships and interlocking activity somewhat
similar to the structure of business as presented by the Temporary
National Economic Committee .
WHAT MAKES Up THE INTERLOCK .
The component parts of the network or cartel in the social sciences
are:
(1) Certain of the major foundations, notably, the various Rocke-
feller foundations, the various Carnegie foundations, the Ford Foun-
dation (a late comer but already partially integrated), the Common-
wealth Fund, Maurice and Laura Falk Foundation, Russell Sage
Foundation, etc .
(2) What might be called intermediary, clearing house, or execu-
tive, organizations and in a way act as wholesalers, such as : The
Council of Learned Societies ; The American Council on Education ;
The National Academy of Sciences ; The National Education Association ;
The National Research Council ; The National Science Foundation ; The
Social Science Research Council ; The American Historical Association;
The Progressive Education Association ; The John Dewey Society; The
Institute of Pacific Relations ; The League for Industrial Democracy ;
The American Labor Education Service and others .
(3) The learned societies in the social sciences .
(4) The learned journals in the social sciences .
(5) Certain individuals in strategic positions, such as certain pro-
fessors in the institutions which receive the preference of the combine .
The patterns of interlocking positions of power may take various

shapes . The following are the most frequent ones :
(1) Trustees or employed executives are successively or simul-
taneously trustees and executives of several foundations .
(2) Trustees or executives serve successively or simultaneously as
officers of other tax exempt organizations receiving grants and/or
retailing the wholesale grants from their own foundations .
(3) Trustees or executives accept appointments to positions of
power in control of education and/or charity so as to multiply their
influence beyond the budgetary powers of their foundation resources .
(4) Foundations jointly underwrite major projects, thus arriving at
a condition of coordination restraining competition .
(5) Foundations jointly create and support centralized coordinat-
ing agencies that operate as instruments of control by claiming supreme
authority in a field of education, science, the arts, etc . without any
resemblance of democratic representation of the professionals in the
management of these agencies .
(6) Rather than distribute money without strings attached, founda-
tions favor projects of their own and supply the recipient institutions
not only with the program, but also with the staff and the detailed
operations budget so that the project is actually under control of the
foundation, while professionally benefiting from the prestige of the
recipient institution . The choice of professors often is one by the
foundation and not one by the university . Foundation employees
frequently switch from work in the foundation, or in the councils
supported by the foundation, to work on sponsored projects and in
professional organizations supported by their funds . They become
most influential in the professional organizations, are elected to presi-
dencies and generally rule the research industry .
One example of interlocking directorates, officers and staff members,
out of many which could be given, is the case of The Rand Corpora-
tion, a corporation in the nature of a foundation . It plays a very
important part in the world of research for the government and would
bear careful study in connection with the extent of interlocked foun-
dation influence on government projects . Among the trustees of
The Rand Corporation are the following, shown with their foundation
connections :
Charles Dollard Carnegie Corporation
L. A . Dubridg---- Carnegie Endowment
National Science Foundation
H . Rowan Ga.ither Jr Ford Foundation
Philip E . Mosely Ford Foundation
Rockefeller Foundation
Harvey S . Mudd Mudd Foundation
Santa Anita Foundation
American Heritage Foundation
Frederick F . Stephan Rockefeller Foundation
Clyde Williams Batelle Memorial Institute
Hans Speier (Ford) Behavioral Science Foundation
This example is particularly interesting because the Chairman of
The Rand Corporation is also the President of The Ford Foundation,
which granted it one million dollars in 1952 . The filed statement of
The Ford Foundation states that the research being conducted under
its grant is entirely "unclassified ." It does not explain, however,
why the president of a foundation should be the Chairman of a semi-
governmental research organization dealing not only with unclassi-

fied material but also with, we understand, highly secret material .
Apart from the interlocking of directorates, but parallel to it, we
observe a high concentration of foundation favors on a limited number
of recipient organizations . It is common knowledge that there are
favored universities and favored individuals . The practice is de-
fended on the ground that these are the most qualified institutions and
individuals . This contention is subject to reasonable doubt . And if
it were true, it is possible that the foundations have contributed to
make it so . It is hard to believe it would not be better for the country
if more institutions and more individuals were encouraged and trained
in research .
The direction of foundation policies and operations by a group of
persons influencing the actions of more than one tax exempt organiza-
tion is per se of greatest concern, for it indicates the existence of the
power to control, even if the actual control and the detailed manner in
which it restrains cultural competition were not always provable . A
condition of control calls for protection against its abuse . Founda-
tions, becoming more numerous every day, may some day control our
whole intellectual and cultural life-and with it the future of this
country . The impact of this interlock, this intellectual cartel, has
already been felt deeply in education and in the political scene .
THE SOCIAL RESEARCH COUNCIL .
As an example of the association of individual foundations with
one of the intermediary or executive foundations, let us take The
Social Science Research Council . It has been supported by contribu-
tions from : The Laura Spellman Rockefeller Memorial, The Russell
Sage Foundation, The Carnegie Corporation, John D . Rockefeller, Jr.,
The Commonwealth Fund, The Julius Rosenwald Fund, Revell Mc-
Callum, The Carnegie Foundation for the Advancement of Teaching,
-The Maurice and Laura Falk Foundation, The General Education Board
(Rockefeller), the Spellman Fund, Trustees of W. E . bpjohn Unem-
ployment Trustee Corporation, The Committee of Trustees on Experi-
mental Programs, The Grant Foundation, The Scripps Foundation for
Research in Population Problems, The American Philosophical Society,
Carnegie Corporation of New York, The John and Mary R . Markle
Foundation, The Ford Foundation, The Twentieth Century Fund, the
U. S . Bureau of the Census, The East European Fund, and The Rock-
efeller Brothers Fund .
The Social Science Research Council is now probably the greatest
power in the social science research field . That this organization is
closely interlocked in an important network is affirmatively asserted by
its annual report of 1929-30 as follows :
"With our sister councils, the National Research Council," the American Council
of Learned Societies, and the American Council on Education, cooperation remains
good and becomes increasingly close and significant . There are interlocking
members and much personal contact of the respective staffs ." [Emphasis ours .]
Professor Colgrove testified to the tendency of the "clearing house"
organizations to move their offices to Washington and to cause their
constituent societies to make the same move . This geographical con-
it Active in the natural sciences .
centration is in the intereststof efficiency, but is also a way of effecting

a greater concentration . He stated that :
* * * There is more day-to-day conversation and consultation between the
officers of the professional societies and the officers of the operating societies, like
the American Council of Learned Societies, and the officers of the foundations .
I think that the officers of the professional societies are extremely good listeners
and follow pretty carefully the advice that is given them by the foundation officers .
(Hearings, p . 570.)
He also testified that there has been a conscious concentration of
research direction, mainly through the "clearing house" organiza-
tions . (Hearings, pp . 570, 571 .)
In Vol. 1, No . 3 of the 1947 Items, a publication of The Social Science
Research Council, Donald Young and Paul Webbink present the role
of the SSRC in improving research . Their recitation includes this
statement :
"The particular role of the Council, however, is that of a central agency to promote
the unity of effort in attacking social problems which is required to assure maximum
returns from the work of a multitude of individual social scientists and of inde-
pendent private and public institutions ." [Emphasis ours.]
While the article says that the Council does not "attempt to operate
as a coordinating agency in any compulsive sense", its very availa-
bility, well-supported by major foundations, seems to have given it a
control over social science research which is, in its effective use, un-
doubtedly compulsive .
To deny that the SSRC is an element in a concentration of power
in the social sciences is difficult in the face of this statement of The Ford
Foundation, quoted by Pendleton Herring in Vol . 4, Number 3 (Sep-
tember, 1950) of the SSRC Items :
"The Social Science Research Council has been included in this
program because it is the instrumentality most used by individual schol-
ars, universities and research organizations for interchange o f information,
planning and other cooperative functions in the fields described
Its grant will be used not so much for the support of independent re-
search projects but rather for any additions to staff or improvements
in facilities which would enhance the service it performs for other
organizations and scholars ." [Emphasis ours .]
The SSRC may be visualized as the center of a net-work of relations
reaching into every layer of social activities related to the social
sciences . If we draw a graphic "sociogram", we will see the pattern
of its operations :
Constituent societies :
Represented at various other nationwide "councils ."
Financial support :
By closely cooperating foundations, which themselves inter-
lock through directorates .
Supported scholarly activity:
Concentration on graduates of a few major institutions, which
also supply most of the directors of the Council, who since
a change of by-laws are chosen by the Council board, not
any longer freely elected by constituent associations .
Influence of government spending for research :

SSRC or similar foundations-supported groups decisively in-
fluence National Science Foundation policy and Defense
Department spending on research via its officers serving
as consultants and board members .
The peculiar nature and construction of The Social Science Research
Council is worthy of examination . It is a self-perpetuating organiza-
tion, sharing this characteristic with foundations in general . It has,
however, some unique features . It purports more or less, to represent
seven of the social science disciplines through their professional
societies . Yet these societies are not, in any sense, members of the
SSRC . They elect delegates to the Board of the SSRC, but are
permitted to elect only from panels of candidates nominated by the
SSRC itself . Thus the SSRC Board is able to, and does, control its
own character . This process, rather undemocratic to say the least,
further tends toward the totalitarian by the fact that the "members"
of the SSRC are its former directors .
Some social scientists suspect that this strange system of election
of directors has been used in order to maintain a board of a character
or bent satisfactory to those in control . The fact remains, whether
the control has been used unhappily or not, that it is essentially
undemocratic and unrepresentative of the professions which it assumes
to represent, and could very easily be used for power purposes .
Some of the results of close cooperation of the foundations support-
ing the Council and of Council officers and chosen directors may be
illustrated by the following examples :
a.) The Encyclopaedia of the Social Sciences, published in 1935
in fifteen volumes, contains many contributions of Council offi-
cers . This publication (to be discussed in more detail later),
though not sponsored by the Council, was endorsed by the iden-
tical associations which constitute the Council and carries an
imprint similar to the listing of constituent associations on present
Council stationery .
b .) We find the names of Council directors and officers on lists
of The Rand Corporation, of The Ford Behavioral Science Fund,
in government advisory groups, and wherever social scientists
congregate in leading positions . We find that some of these
SSRC officers have advanced into positions controlling the sources
of funds (e . g., Messrs . Young and Cotrell now at Russell Sage),
and since the start of foundation support for the Council in the
early twenties we find foundation officers participating as Council
members in running Council affairs . (Messrs. Ruml, Herring,
etc .)
The Council stationery gives the misleading impression that it is a
representation of its constituent membership . In reality, since the
change in its by-laws, the "constituent" societies have served mainly
as the prestige-lending background of the Council, creating the im-
pression that the Council is a democratically constituted mouthpiece
and representation of all social scientists in America .
Even if the Council were democratically elected and not operating
by continuing the control through a core group, it would not represent
all or even most American social scientists . W e do not know whether
the seven "constituent" associations of the Council can be considered

democratically ruled, but in response to our inquiries the seven
associations gave us their membership figures. From these it became
quite clear that they are only a part, even if in some instances a sub-
stantial part, of the total . Whatever the composition may be, the
SSRC has in the past gained leadership, among other reasons, because
it successfully created the impression of representing the majority of
all social scientists in America .
The power of the SSRC seems to be used to effect control of the
field of social sciences . The concept of an efficient central clearing house,
available to foundations to assist them in spending their funds is attrac-
tive on its face . But this type of delegation by foundations, resulting in
the concentration of enormous power into a few executive hands, not
only violates the essential quality of foundation-trustees' fiduciary respon-
sibility but gives to the individuals controlling the delegated mechanism,
in the interests of efficiency, a power which can be dangerous by reason of
that very fact.
There is evidence that professorial appointments all over the United
States are influenced by SSRC blessing . With great foundation
support at its command, it has the power to reach in various directions
to exercise influence and, often, control . The 1933-34 Report of the
National Planning Board (prepared, incidentally by a committee of
the SSRC) stated :
"The Council (the SSRC) has been concerned chiefly with the determination of
the groups and' persons with whom special types of research should be placed ."
To have this function (gained by foundation support) gives it a power
the ultimate results of which can be far-reaching .
It would be interesting in any continued investigation to study the
part played by The Social Science Research Council and the societies
associated with it in controlling book reviews and the literary pro-
duction of social scientists . In the American academic world scholars
are largely rated by their publications, and it is often on a quantita-
tive as well as a qualitative basis . Consequently, the opportunities
for securing publication of scientific papers can have much to do
with the academic career of a social scientist . Similarly, the type of
reviews given to such books as he may write can obviously have a
bearing upon his future and his standing .
Professor Rowe (Hearings, p . 549), speaking of the influence of
foundations in educational institutions, said :
"* * * you have to realize * * * that advancement' and promotion and survival
in the academic field depend upon research and the results and the publication
thereof . Here you have, you see, outside organizations influencing the course of
the careers of personnel in universities through their control of funds which can
liberate these people from teaching duties, for example, and making it possible for
them to publish more than their competitors ."
. Thus the control over a scientific journal permits any group in
power to favor or disfavor certain scholars and to impress its
concepts and philosophy on a generation of school teachers, textbook
authors, writers and others . A careful study should be made to as-
certain whether the professional journals in the social sciences have
been truly objective in their editorial and reviewing approach .
It can be contended that there are other powerful centers of social
studies in the United States in competition with SSRC : the Ford
Behavioral Science Fund, The Twentieth Century Fund, The American
Academy of Pctitical and Social Sciences and others ; but with almost
all of them there exist personal and organizational ties and cross con-
nections via supporting foundations . Moreover, there is a strange
similarity of approach among such groups ; they all seem to fall into the
same "liberal" economic and social points of view . Is this accident
or coincidence? It suggests itself to us (and it is a matter requiring
far more investigation) that the concentration of power to which we
refer has been consciously used to foster and develop this attitude .
Charles Dollard (President of The Carnegie Corporation of New
York) contributed an article, in Items, The Social Science Research
Council Publication, The Strategy for Advancing the Social Sciences,
in which he refers to the errors of election polls and to the statistical
mistakes of Kinsey, and says :
"The third strategic move which I would suggest is that social science initiate a
more rigorous sytem of internal policing ." (Page 19 .) [Emphasis ours .]
We ourselves are extremely dubious of the scientific character of
the methods used by Dr . Kinsey, as we shall discuss later . We
cannot understand why his work should have been supported by
The Rockefeller Foundation or any other foundation . But we cheer-
fully grant to Dr . Kinsey the right, as an individual working with
other than public funds, to make any mistakes he wishes and to
select any methods or objectives he chooses . The concept of "polic-
ing" is rather terrifying. Did Mr . Dollard mean to say that The
Social Science Research Council and other "clearing house" organi-
zations should do the policing? That any such organization should
even entertain a proposal to create uniformity-even in the interests
of efficiency and better method-or to press grantees, whether indi-
vidual or institutional, into common moulds in any way, would be
deeply regrettable. Few could risk criticizing, few academicians at
least. There would emerge what has been called a "Gresham's
Law in the field of professorships in the social sciences ."
We could not more strongly support the statement made by Presi-
dent Grayson Kirk of Columbia University in an address on May 31,
1954, in which he said :
"We must maintain the greatest possible opportunities for the free clash of
opinions on all subjects, trusting to the innate good judgment of men and women
to reach decisions that are beneficial to society ."
The very fact that a leading foundation executive, in an America
traditionally opposing restrictions of free speech and thought, can
call for a system of internal policing indicates the chasm between a
concept of scholarly orthodoxy and the real freedom of inquiry to
which Dr . Kirk referred .
The various organizations which compose the center of the concen-
tration of power, the "clearing house" organizations, can all clearly
point to admirable and valuable work which they have done . It would
be difficult, indeed, to find a foundation which is wholly bad, and the
"clearing houses" to which we refer have a great deal to their credit .
What concerns us at the moment is that a power exists, concentrated
in a comparatively small number of hands, a power which, though it
has been used often for much good, can be used for evil . The existence
of such a power, dealing with public trust funds, to us seems to involve at
least a potential danger or risk, however benevolently to date its relative
despotism may have acted .

THE AMERICAN COUNCIL ON EDUCATION .

Another of the "clearing houses" is The American Council on
Education. It is a council of national education associations, financed
by membership dues and government contracts, and by heavy con-
tributions from major foundations and comparable organizations, such
as The General Education Board (Rockefeller), The Carnegie Corpora-
tion of New York, The Carnegie Endowment for International Peace,
The Carnegie Foundation for the Advancement of Teaching, The
Rockefeller Foundation, The Ford Fund for Adult Education, The
Alfred P. Sloan Fund, The Payne Fund, B'nai Brith, The National
Conference of Christians and Jews, The Edward W . Hazen Foundation,
The Grant Foundation, The Ellis L . Phillips Foundation, and others .
A pamphlet issued by The American Council on Education in July
1953 frankly calls this organization a "clearing house ."
"More specifically, the Council has been a clearinghouse for the exchange of
information and opinion ; it has conducted many scientific inquiries and investi-
gations into specific educational problems and has sought to enlist appropriate
agencies for the solution of such problems ; it has stimulated experimental activities
by institutions and groups of institutions ; it has kept in constant touch with
pending legislation affecting educational matters ; it has pioneered in methodology
that has become standard practice on a national basis-* * * ; it has acted as
liaison agency between the educational institutions of the country and the federal
government and has undertaken many significant projects at the request of the
Army, Navy and State Departments and other governmental agencies ;
and * * * it has made available to educators and the general public widely used
handbooks, informational reports, and many volumes of critical analysis of social
and educational problems."
The Council maintains imposing offices in Washington, D . C .,
which may not be without significance as, among its many committees, T
some are concerned with tax, social security and other legislation as
it affects institutions of higher learning . Its committee most inter-
esting to us is that on Institutional Research Policy . A Brief
Statement of the History and Activities of the American Council on
Education, dated July 1953 describes the functions of the Research
Policy Committee as follows :
"Established 1952 to study the interrelationships of sponsored research from the
viewpoints of federal agencies, industries, and foundations sponsoring such research,
and the effect on institutions doing the research . This latter angle involves the dis-
tribution of grants among institutions and the concentration of research in fields at
the expense of other fields and the distortion of the institutional picture as a whole .
The magnitude of the problem is shown by the fact that 20 or more federal agencies
are currently subsidizing more than $150,000,000 worth of research a year ; in-
dustrial and business concerns and private foundations also sponsor research .
The numerous `special interest' involved may approach the same problems in
different ways and come up with different solutions . It is the aim of this Council
committee-composed of college presidents, vice-presidents for research, business
officers, and faculty members directly engaged in sponsored research projects-
to attempt to formulate a policy for the national level based on cooperative relation-
ships ." [Emphasis ours .]
Note that, like The Social Science Research Council, this Council is
an interrelating agency, coordinating the work of other research
organizations and researchers, establishing policy and acting as a
distributing agent for granting-foundations along planned and inte-
grated lines . That may well create efficiency, but is it solely efficiency
we want in research in the social sciences? As Professor Rowe and
others have said : it would seem far better to lose efficiency and give
individuals of quality the opportunity to go in their own respective
directions unhampered by any group control, direction or pressure .
However laudable much or most of its work may have been, the
Council has certainly been one of the media through which founda-
tion funds have been used to effect considerable control or influence
over education in the United States . Some may argue that this
control or influence has been wholly good-were this so, we would
still believe that the power of great foundations to affect educational
policies and practices is one which should concern the public . By
the same token, we believe that "clearing house" organizations, while
they may serve a purpose in the direction of efficiency, are of ques-
tionable desirability when interlocked financially or by personnel
with these foundations. The aggregate power involved in such a con-
centration gives us concern .
OTHER INTERLOCKS AND FURTHER DANGERS .
Opposite this page there appears a reproduction of a chart intro-
duced by the Assistant Director of Research, showing the Inter-
relationships Between Foundations, Education and Government . As
Mr. McNiece explained :
"The relationships between and among these organized intellectual groups
are far more complex than is indicated on the chart . Some of these organizations
have many constituent member groups . The American Council of Learned
Societies has twenty-four constituent societies, the Social Science Research Council,
seven, the American Council on Education seventy-nine constituent members,
64 associate members, and 954 institutional members . In numbers and inter-
locking combinations they are too numerous and complex to picture on this
chart ." (Record, p. 1018 .)
There are, moreover, other organizations in some number not noted
at all on the chart which fulfill some intermediary function in asso-
cation with foundations and other organizations which are indicated .
There is, in addition, a Conference Board of Associated Research
Councils, composed of The American Council of Learned Societies,
The American Council on Education, The National Research Council
and The Social Science Research Council, organized "to facilitate
action on matters of common concern ." It "continued earlier informal
consultations of the executives of the Councils . Its functions are
limited to administration of joint activities authorized by the Councils
and consideration of mutual interests ." (From the 1943-45 Annual
Report of the SSRC, page 16 .)
The central organizations, such as The Social Science Research
Council,
"may be considered as `clearing houses' or perhaps as `wholesalers' of money
received from foundations inasmuch as they are frequently the recipients of rela-
tively large grants which they often distribute in subdivided amounts to member
groups and individuals ." (Record, p . 1019 .)
Nor does the chart show all the functions of government in which
foundations operate or to which they contribute .
"The lines connecting the various rectangles on the chart symbolize the paths
followed in the flow or interchange of money, men and ideas * * * ."
But this process, highly concentrated through the intricate inter-
relationships, is both complex and ominous . A high concentration
of power is always dangerous to society . As we have said, it can be
constructed or come into being for wholly benign purposes, but it
can readily be used by those whose objectives are against the public
interest .
The Cox Committee record shows that a conscious plan by the

Communists was inaugurated to infiltrate the foundations for the
purpose of appropriating their funds to Communist uses . We know
from the evidence that the Communists succeeded in the case of
seven foundations : The Marshall Field Foundation ; The Garland
Fund ; The John Simon Guggenheim Foundation ; The Heckscher Foun-
dation ; The Robert Marshall Foundation ; The Rosenwald Fund ; and
The Phelps Stokes Fund ; and we are aware of the tragic result to our
nation and to the world of communist infiltration into The Institute
for Pacific Relations . We know also that (then undisclosed) Com-
munists and their fellow-travellers had been able to secure grants
from other foundations, including Carnegie and Rockefeller . We know,
further, what the Cox Committee report referred to as "the ugly
unalterable fact that Alger Hiss became the President of The Carnegie
Endowment for International Peace ." We do not know the full extent
to which there has been penetration or use of foundations and their
resources. It is too much to assume that Communist success was
limited to the exposed instances . Indeed, where foundations are in-
volved in so high a concentration of power as the chart discloses, we
may assume that some advantage may have been taken by Com-
munists to use this interlock, directly or indirectly, for malign pur-
poses .
This Committee is not in a position to assess the extent of such use
but warns against the inherent danger that a concentration of power
constitutes a weapon at hand for such as may wish to suborn it for evil
designs . The number of grants made to Communist agents or agen-
cies is relatively tiny in comparison with the aggregate grants by
foundations . But this numerical comparison casts no light on the
degree of damage which has been done . One grant of comparatively
small amount may do frightening damage . Professor Rowe testified
(Hearings, p . 534, 535) to the effect that the test of damage is qualitative
and not quantitative . Moreover, the Communists do not always work
directly . In their desire to undermine our society they operate more
frequently than not by indirection, supporting causes which merely
tend to the left but cannot be identified as actually Communist .
The main concern of this Committee is not with Communism . We
agree with Professor Rowe in his estimate that the greater danger lies in
the undermining effect of collectivist or socialist movements . Externally,
Communism is the greater danger ; internally, socialism offers far greater
menace.
In either event, whether the penetration is by outright Communists
or by some other variety of socialists or collectivists, the danger of
its occurrence is far greater when there exists a complex of interrelated
and interlocked organizations . There are more opportunities for
shifting both personnel and grants . There is much less control through
supervision by the trustees of the foundations which supply the basic
funds used by the intermediaries . After they have poured these funds
into the managerial hands of others, the detailed distribution is
beyond their control . Perhaps the Rockefeller Foundation trustees
might well have recognized a Communist penetration in their own
foundation had it existed to the extent it did in the Institute of
Pacific Relations. They did not recognize it in this intermediary to
which they granted millions . The difficulty of watching over the
disbursements of an intermediary is not the only danger in the current
system. Foundation trustees are inclined to shrug off responsibility
on the unsound theory that, having selected a recipient organization,
the granting foundation bears no responsibility for what that inter-
mediary does . The menace of extreme leftist penetration of the
foundation world is thus multiplied in seriousness by the existing
system of interlock and the use of intermediary organizations .
Aside from this direct menace, the dangers of so close an interlock,
so high a degree of concentration of power in intellectual fields, tends
to violate an essential of the American system, competition . Some
unfriendly newspapers have accused this Committee of trying to establish
"thought control" in the foundation world, or to act as a "censor", or to
wish to promote "conformity" . The exact opposite is the case . This
Committee is highly critical of the system of concentration under discussion
for the very reason that it promotes conformity, acts in effect as a censor of
ideas and projects, and produces a tendency toward uniformity of ideas .
In this area of discussion it becomes most important to realize that
the United States Government now expends annually on research in
the social sciences far more than all the foundations put together.
This might be a factor offsetting the concentration of power which
the foundations and their supported creatures constitute, were it not
for the fact that government-financed research in the social sciences is
virtually under the direction of the very same persons and organiza-
tions who dominate the foundation concentration of power . Thus,
not only are great parts of the vast public funds which the foundations
represent used in largely coordinated fashion by the concentration,
but even larger . sums of public money directly provided by govern-
ment are, to all practical purposes, employed by the same groups .
This situation is quite distasteful . Americans do not cherish the
concept that society should be directed by a clique . Though it may
indeed be elite, we do not wish it to direct us . Moreover, there is
considerable doubt that the presumed elite is indeed so . One of the
most important of the "clearing-houses", The American Council of
Learned Societies, an intrinsic part of the concentration of power,
presumes to represent the elite in the disciplines . To this organization,
foundations annually grant large sums of public money . Through it a
great amount of research in the social sciences is done or directed .
Yet its executive secretary for a long period has been MORTIMER
GRAVES. In the Cox Committee Record at page 544, Mr. Keele,
its Counsel, read from a long list of Communist-front organizations
of which MR. GRAVES was a member, and Mr. Keele did not exhaust
the list .
We do not accuse MR. GRAVES of being a Communist . But it
amazes us that one with so evident a lack of political and social
discernment, with such apparent lack of objectivity, should be re-
tained as a directing officer in what purports to be the representative
organization for all the social sciences and humanities . MR . GRAVES -
still holds his position, though the Cox Committee hearings brought
out his extensive record of Communist-front affiliations . This leads
us to conclude one of two things ; either his personal power is astound-
ing or the extreme political slant of an executive is deemed of no
moment by that tax-exempt agency of the foundations .
Under date of August 23, 1954, General Counsel to this Committee
addressed a letter to MR . GRAVES, a copy of which is attached to
this report as an appendix.12 A reply was received stating that MR.

GRAVES was abroad and would not return until early in September .
A reply was finally received from MR . GRAVES in November . In the
letter addressed to him, fifteen detailed questions were asked concern-
ing his reported Communist-front affiliations, 13 his sponsorship of
known extreme leftists, recommendations made by him (on behalf
of The Council of Learned Societies) to government agencies (the lists
reputedly containing some Communists or fellow-travellers), and con-
cerning other matters important to this investigation .
MR. GRAVES' reply (Hearings, page -) gave the Committee certain
responsive material but failed to disclose the recommendations made
by him to government agencies . The Committee cannot understand
his failure to do so unless it was by intention . Mr . Graves' reply
seeks to explain away his Communist-front associations, but the aggre-
gate number of those with which he has been charged by other inves-
tigations raises a grave question as to his capacity or willingness to
act without bias as a foundation executive .
MR. GRAVES is one of the leading characters in the dramatis personae
of the foundation world, a major executive of a powerful intermediary
organization which is an intrinsic part of the foundation-supported
concentration of power, a key figure in academic circles, an adviser to
government . The foundation world continues to accept him as one
of its leading lights .
So, we ask again, are these officers and directors of the foundations
and clearing houses and those whom they favor with their benefac-
tions "elite?" The specialists in the social science fields are obviously
better informed in their specialties than is the general public. This
does not, however, establish that their judgment regarding the appli-
cation of their knowledge is sound . We have had plenty of examples
of brilliance in a specialty, accompanied by a social judgment so
deficient as to be tragic . No one can doubt the genius of Klaus
Fuchs, for example, nor his sincerity ; neither offered him any basis
for sound social judgments .
There is the further danger that an elite group tends to perpetuate
itself, both as to personnel and as to opinion and direction . It is only
through competition in the intellectual fields, just as in business, that
progress can safely be accomplished . Anything which tends to pre-
vent or restrict competition seems to this Committee frought with
frightening danger to our society .
Public opinion is greatly determined, in the long run, by the influence
of intellectuals . Therefore, it seems essential to this Committee that
intellectual life be as unhampered and freely competitive as possible .
Any concentration of intellectual effort, any mechanism tending to con-
formity, is essentially undesirable, even if, for the moment, directed solely
to desirable ends. A political dictatorship may be benevolent, but we
want none of it . Similarly, an intellectual-group-dictatorship may
be benevolent, but we want none of it .
We urge a detailed reading of the testimony of Mr . McNiece,
beginning at page 465 of the Hearings, in which he explains
the extent and working of the interlocking concentration of power
which has been financed by foundations and has taken over much of
government function in the social science areas . We are dealing here
12 See p . -
33 Seep . - for list of affiliations .
with vast sums of money, the impact of which can be and has been
terrific . Mr. McNiece noted that six foundations alone have made
;rants aggregating over $60,000,000 to some of the intermediate or
clearing-house organizations . Significant also, incidentally, were
aggregate grants of over $4,000,000 to The London School of Economics,
at a time when it was a fountain-head of Fabian socialism . (Hearings,
p . 475 .)
POLITICS-POWER FLOW-PLANNING .
Mr. McNiece described a "central or main stream of influence"
running from the foundations and their centralized agencies into
government . (Hearings, p . 601, et seq .) There was considerable
evidence to show that the government has come to rely upon the
"clearing houses" for lists of men who can assist as specialists in the
"social sciences ." On its face this practice seems desirable enough,
but closer inspection discloses severe dangers . As Mr. Reece, the
Chairman of the Committee, remarked :
The CHAIRMAN . We have in the United States the colleges and universities
which, while large in number, are very accessible to be advised about the require-
ments of Government. While there is nothing wrong in asking one of the societies
to furnish a list of names, as I see it, do we not know from practical experience
that when a council such as the Council of Learned Societies is put in the posi-
tion of furnishing a list of scholars to advise the Government, that list will be
pretty much the recommendation of the man who happens to be administrative
officer of the council that makes up and supplies the list . Insofar as that is the
case, that puts in the hands of one man a tremendous influence . If he happens
to be a man that has certain inclinations, he is in a position to give very wide
effect in those inclinations, if he is put in a position where he furnishes the list
of the experts the Government calls into the service as advisers . That is the
angle that I see that becomes, to my mind, Mr. Hays, very important .
It is the concentration not only in one organization, but ultimately largely in
the hands of one man . (Hearings, pp . 602, 603 .)
We discuss elsewhere the power which executives of foundations
and "clearing houses" exercise . Professor Colgrove gave important
testimony in this area. He said that academicians are reluctant to
criticize foundations . He testified to the "fawning" over those who
distribute foundation funds, giving as an example the attitude of
professional associates toward Professor Merriam, long a power in
the social-science-foundation world . Professor Merriam himself had
said :
"Money is power, and for the last few years I have been dealing with more
power than any professor should ever have in his hands ." (Hearings, p . 565 .)
In the last analysis it is frequently individuals, or small groups of
individuals who perform the act of recommendation and virtual ap-
pointment of "scientific" personnel to the government . The political
slant of these individuals may thus seriously affect the character of
government operations . We have seen many Communists and
fellow-travellers recommended by foundation executives for gov-
ernment posts . In the case of the recommendations to the government
made by the Institute of Pacific Relations and the American Council of
Learned Societies for experts to be used by our occupation forces in Ger-
many and Japan, the lists were heavily salted with Communists and their
supporters . (Hearings, pp . 559, 560 .)
The Chairman seriously questioned the process of the government
relying on the existing mechanism for making social-science appoint-
,65647-54 5
ments . He said that the administrative officer of an operating society

who made such recommendations
"is a man that has no public responsibility, not like the President or a cabinet
officer, whom we know who do have public responsibility . Nor like the President
of a college who is identified in the public' mind, and to a very large degree is held
responsible not only by the board of trustees, but particularly by the alumni
of the institution, and a very wide segment of the public, which is quite different
from some man that is ensconced in the office of a learned society that is in a
building downtown here . At least I see a very wide difference . In so far as there
is a disposition to concentrate into one or a few places-it probably should not he
described as authority to recommend-the privilege of recommending people for
government consultants . I would have quite a serious question in my mind
about it ." (Record, p . 1342 .)
In reply to Counsel's question whether he did not think foundations
might better turn to the universities and colleges for research instead
of to intermediate organizations, Professor Rowe testified :
Dr . RowE . Yes, sir . There has, of course, been a mixed method on the part
of IPR . You get a very interesting carrying down the line of the funds and the
projects . Foundations will give funds to organizations like IPR . Some of this
money for research purposes will be directly handled by the IPR . Young people,
scholars, will be brought into the organization . t o do specific jobs for the organiza-
tion . However, they will also go to universities and ask universities as they did
once in our case to provide, so to speak, hospitality for one of the men that they
want to have perform a research function under guidance and direction, subsidized.
b y IPR, which money came from Rockefeller Foundation in this case . Then they will
do other things . For instance, the IPR organization will give money to the univer-
sity personnel themselves directly for either research or publication purposes . So
there are all kinds of ways and manners of doing this . I would submit that in
much of this, procedure the choice of personnel, the passing on their qualifications,
the framing of projects, and the guidance of the researchers in the process of carry-
ing out projects, is not adequately provided for by these organizations, such as
the Institute of Pacific Relations was and still is today .
In the case of universities, where appointments are made, the universities'
faculties are people of long standing, they may be good, bad, or indifferent, but
the organization and the procedures of appointment and approval thereof are
sufficiently complex and involve sufficient safeguards to cut the errors down con-
siderably below the errors that are possible and probable without these forms of
supervision and sanction .
It seems to me that the foundations in giving funds to organizations such as the
Institute of Pacific Relations are in general on rather weaker ground than if they
give funds-to established organizations for research purposes in which the criteria
for the appointment of people, for their promotions, for their advancements and
things of that kind have been worked out over a long period of time .
The informality of the arrangements in the IPR was one of the things that
I have always wondered at . To make it possible for so few people to have so
much power and influence in determining who got funds for what purpose and
determining what kind of projects they worked on and how these projects were
supervised seemed to me to be very lax . Of course, toward the end the money
that IPR got . was heavily given to publications . They would subsidize the
publication of. works that were produced by research workers in universities and
other such organizations, as well as their own people . This seemed to me to be
getting away a little bit from the evils of the previous system in which they were
directly involved in the research function . But it still put a tremendous lot of
power in the hands of a very few people, since they went all over the United
States, looking over the products of research in the far eastern field, and deciding
which of these they would subsidize and which they would not .
This is not to say for a moment that the foundations have not given funds
directly to universities . Of course they have . I suppose they have given far
more funds for research purposes directly to universities than to organizations
such as the IPR. But it seems to m .e, and you can, of course, consider the source
here-I am a member of a university community-it seems to me logical to say
that in those communities you get better safeguards as to quality and personnel
than you can get in any such organization as the Institute of the Pacific Relations,
set up to a heavy extent for research purposes outside of academic communities .
(Hearings, pp . 544, 545 .)
Later the following colloquy took place :
Mr . WORMSER . * * * I would like to get on another subject, which one of
your previous remarks introduced . We were discussing the undesirability per-
haps of using intermediate organizations like IPR. Would your comments apply
also, and perhaps you might discuss this general area, to what we have referred
to at times as clearing house organizations? We have talked about a certain
interlocking or, close relationship between the foundations and intermediate
organizations, like The Social Science Research Council, and The American Council
of Learned Societies . I would like you to comment on that, Professor, as well as
whether you think the resulting concentration of power through this interlock
is a desirable thing or not .
Dr . RowE . I suppose the proof of it is in what comes out of it . My feeling is
that here is another very clear evidence of the difficulty for the foundations in
making policy regarding the expenditure of their funds . The Social Science Re-
search Council handles social science matters . They will give a large lump sum of
money to these people . Then The Social Science Research Council has to set up
the operations of screening of applications, screening of candidates, supervision of
operations and evaluation of results and all that . This costs the foundations some-
thing, because part .of the money they put in has to go for . these administrative
purposes . But the foundation doesn't want to do it itself . The Social Science
Research Council being supposedly a specialized agency simply, it seems to me,
relieves the foundation of this to the extent that the foundation gives large sums
of money to The Social Science Research Council.
What the Council does is the responsibility of the foundation, it seems to me,
to a very great extent . There is no use trying to blink at that fact in any way,
shape, or form . I suppose there is no ideal solution to the problem of the applica-
tion of expertness to the supervision of the expenditure of money by big founda-
tions . This is why some foundations go in for rather narrow kinds of specializa-
tion . They will do one kind of thing and not another . The General Education
Board is an example of what I am talking about, because their work has been
rather narrowly oriented, certainly during the last decade or two . But the big
foundations in general spread themselves over the landscape .
The Ford Foundation is the latest and greatest . The Ford Foundation is even
going in for general public education, although I understand this emphasis is
decreasing some in the last year or two . But when they first began they were
very much interested in general adult education through all kinds of media, radio,
conferences, great book seminars all over the country . We had 2 or 3 of them in
our immediate area in Connecticut, all financed by The Ford Foundation .
The. job of running an extension course for universities is a big job . When you
start doing this all over the United States, I should think it would be almost im-
possible to supervise it adequately . If I am right about the tendency in recent
years, it might be that this is a conclusion they have reached on the matter, if
they are cutting down . I would not know what has guided their policy along
this line .
There is inevitably going to be this problem, that as knowledge and as research
become more specialized and more technical, and the problem of deciding what
you want to do researchwise becomes more difficult, the foundations that have
big money to spend are just up against a tremendous policy . problem . How do
they operate, and how can they possibly . guarantee the maximum effectiveness
and efficiency in their operations in the light of the objectives . which they profess
and which underlie their whole activity?
Mr. WoicMSER . Does it impress you as socially desirable that the , large founda-
tions should concentrate a certain large part of their operations in the social
sciences in one group or association, of groups, . like The Social Science Research
Council, The American Council of Learned Societies, and others?
Dr . RowE . I suppose the theory behind this is that these organizations, 'like
The Social Science Research Council, are truly representative of social science all
over the United States . I suppose that is the only possible theoretical justifica-
tion for this kind of policy . I don't know .
Mr . WoRMSER . The question we have, Professor, in that connection is whether
that type of concentration, even though it might be efficient mechanically, is de=
sirable insofar as it militates against the competitive factor, which is sort of in-
trinsic in our society.
Dr. ROWE . There is no question but what an organization like The Social
Science Research Council has a tremendous amount of power . This power which
it exerts, it exerts very heavily on educational institutions and their personnel,
because when you get down to it, who is it that does research in social science?
It is educational institutions, because they have the faculties in the various fields,
like political science, economics, anthropology, sociology, geography and so on .
That is' where the people are . To understand the importance of this function,
all you have to realize is that advancement and promotion and survival in the
academic field depend upon research and the results and the publication thereof .
Here you have, you see, outside organizations influencing the course of the careers
of personnel in universities through their control of funds which can liberate these
people from teaching duties, for example, and making it possible for them to pub-
lish more than their competitors .
This, therefore, means that there is a tremendous responsibility here to
apportion their awards in a just way-in such a way as takes into account the
differences of approach and the differences of opinion in these fields ; the theoretical
differences from one school to another . The possibility exists that at all times in
any of these organizations that the people in charge thereof become convinced that
there is one way to do a job in the social science field, and that only this way will get
their support.
If and when that time comes-I don't know whether it is here or ever will come-
then you will have a combination in restraint of trade within the limits of public
acceptability that may have very deleterious effects upon our intellectual community .
[Emphasis ours .] (Hearings, pp . 548, 549, 550 .)
Let us see whether in the field of social science research such a
movement "in restraint of trade" has not, in effect, come about .
VIII . THE FOUNDATIONS AND RESEARCH IN THE SOCIAL SCIENCES

THE PREDOMINANCE OF EMPIRICISM .
There has been frequent and severe criticism of foundations on the
ground that, in their support of research in the social sciences in
association with the concentration of power described in the previous
chapter, they have promoted an excess of empirical research .
The normal scientific process employs both theoretical and em-
pirical research . The theoretical is deductive reasoning from accepted
premises . The empirical is inductive reasoning from observed data .
The usual process is to set up a hypothesis, derived from some form
of reasoning, or selected by accident or arbitrarily . This hypothesis is
then generally tested by various means, including both deductive
and inductive approaches . Empirical research can produce material
of usefulness by way of the collection of data ; but it is rare indeed
when such research, without relation to or counter-check by theoret-
ical research, can produce a result upon which any new course for
society can safely be recommended . Empiricism by the very nature
of its approach, ignores moral precepts, principles and established or
accepted norms of behavior, and seeks to base conclusions solely upon
what the senses will take in by means of observation .
These critics, therefore, say that empirical research is obviously a
necessary component of the general investigatory method but,
unless combined with the theoretical approach, it can lead into serious
and often tragic error . They urge that the foundations are mis-
directing their funds in social science research areas if they do not
see to it that empirical research is balanced by theoretical . It seems
impossible to deny the validity of the comment made by Professor
Hobbs in his testimony (Hearings, p . 167)
I' would feel very definitely that so-called empirical findings must be fitted into
a framework of the legal precepts, the traditions, the history, the moral codes,
the military principles of the area in which they are applied . That in and of
themselves, by their very nature, they exclude the intangibles which may be not
only important but may be crucial in a final decision .
It is difficult to decide which is the cart and which the horse ;
whether a predominance of empirical interest started in the universi-
ties and took over the foundations, or whether the . foundations have
been the controlling factor in filling the universities (and thus research)
with empiricists . It seems to this Committee that it makes little
difference . If the controlling thought in the universities and in the
foundations is in the direction of empiricism, to the virtual exclusion
of theory, a situation exists which, in its imbalance, may be very
dangerous.
Predominant opinions tend to perpetuate themselves . If a univer-
sity department is predominantly empiricist, it is likely, through
what might be called "intellectual nepotism", to exclude the entrance
of teachers of the opposite research persuasion . If a foundation,
particularly when associated with the concentration of power which
has been referred to, tends predominantly to the empirical, it is likely
to promote this approach to the exclusion of the opposite school .
Thus, in the course of time, and this seems often to have happened,
the whole field is dominated by persons of one persuasion .
A numerical Gallup Poll of "authorities" in the social sciences would
undoubtedly show that most of the "best people" in the field would
support the predominant empirical approach . That does not prove
that they are right . It is quite possible, as the critics suggest, that
theorists have not had an equal opportunity to get into the ranks and
to rise in them . It might well be as though a group of Republicans,
having obtained control of foundation management and of university
departments, had steadily increased their control by excluding
Democrats and now claim that most people who are prominent in
the trade are against Democratic research . This might then be true,
but does it prove that the Republicans were right in excluding the
Democrats?
If the public money which goes into research in the social sciences
through the operation of foundations has been and is being directed
consciously and overwhelmingly into one theory of research, to the
virtual exclusion of another theory held necessary to be integrated by
many men of competence and stature, the Committee would conclude
that this favoritism for one theory is against the public interest .
There is considerable evidence to show that this favoritism and
exclusion does exist, and to a marked degree .
The Social Science Research Council, the most important of the
"clearing house" organizations in the social sciences, apparently
maintains a program for the development of researchers in these fields .
The funds are supplied by major foundations, in substantial amounts ;
but the SSRC seems to be the chief executive of what is apparently a
program widely supported by the foundations to produce more re-
searchers . On the face of it, this seems a most admirable enterprise .
However, the conclusion is inevitable that its program is directed
overwhelmingly toward the production of empirical research . Pam-
phlets issued by SSRC announcing "Fellowships and Grants" describe
the fellowships as of two classes . The first is "Those designed ex-
clusively to further the training of research workers in social science ."
The second is "Those designed to aid scholars of established compe-
tence in the execution of their research," namely, the Travel Grants for
Area Research, Grants-in-Aid of Research, and Faculty Research
Fellowships .
In a letter to a member of the Committee staff, the President of

SSRC says :
"In the case of the faculty research fellowship program it was agreed that the
recipients would be chosen in terms of their competence ìn formulating and testing
hypotheses concerning social behavior by empirical, and if possible quantitative
methods .' " [Emphasis ours .]
The pamphlets, on the other hand, referring to the other group of
fellowships-those intended to train researchers-says :
"These fellowships may be granted for programs that will afford either experience
in the conduct of research and first hand analysis of empirical data under the
guidance of mature investigators, or further formal training, or both ." [Emphasis
ours .]
. Thus all the neophytes who are to become "social scientists" must
operate empirically to get any help through these fellowships . Simi-
larly, having attained positions on a faculty, it seems they cannot
have one of. these faculty fellowships except for empirical studies .
That leaves only part of the second class, namely, "Travel Grants for
Area Research", and "Grants-in-Aid of Research ." Perhaps empiricism
is not demanded for a Travel Grant, but it would seem clear that it is
again a prerequisite to a Grant-in-Aid of Research . The pamphlets
recite that "Grants will not be given to subsidize the preparation of
textbooks or the publication of books or articles, or to provide income
in lieu of salary." Therefore, and because much theoretical research
requires little equipment and merely financial support while the time
is taken to do thinking, reading and ' analysis which almost always
results in the production of a book or an article, theorists, as against
empiricists, seem to be given short shrift .
In Fellows of the Social Science Research Council 1925-1951, the
Council writes, describing the Research Training Fellowships begun
in 1935, as follows :
"There has been no arbitrary assignment of quotas by disciplines, but a constant
effort to encourage training by rigorous empirical research in all fields ." [Em-
phasis ours.l
THE "FACT-FINDING MANIA" .
No laboring of this point is needed . The executives of the major
"clearing house" organizations on the whole would not only admit
that they overwhelmingly support empirical research ; they would
acclaim it as highly desirable . They maintain that, whatever the
weaknesses of data-collection, an accumulation of empirical results
adds to the great body of knowledge and forms additional bases for
further research . Moreover, it is probable that an opinion census of
social science professors would show that most of them believe (1)
there is an adequate balance of theoretical with . empirical research
and (2) that, in any event, there cannot be too much empirical col-
lection of data . A letter to Counsel from Professor of Sociology C .
Arnold Anderson, of the University of Kentucky, for example, ex-
presses what is certainly the majority point of view of the present
social scientists . He says : "* * * we must recognize that it is im-
possible to have too many empirical facts ." He adds : "The answer
to inadequate facts is more facts ." He concludes emphatically that
"There has not been an unfair or undesirable preponderance of em-
pirical research . What the social sciences need is enormously more
money for the collection of facts, and for the testing of theories by
facts ."
There are eminent professors and social science technicians, how-
ever, who insist that empirical research has unfairly predominated .
They point out that the mere collection of "facts" unrelated to theory
and untested, or unchecked and uncheckable in many instances, adds
nothing of any consequence to the sum total of human knowledge .
Indeed, Professor Anderson himself says in his letter that "Fact and
theory are constantly at play, one upon the other . Every reputable
social scientist strives constantly to balance and integrate those two
facets of scientific work ." Those of the critical point of view believe
that great numbers of foundation-supported social scientists, in their
anxiety to use the factual approach to research, have failed to do
that very integration between "fact" and theory which Professor
Anderson indicates is essential to sound work .
In a paper, New Concepts in Education, delivered before the Ameri-
can Association for the Advancement of Science at Cleveland on Decem-
ber 27, 1950, Stuart A . Courtis commented on one aspect of fact-find-
ing as follows:
"As a result we are today in possession of mountains of quantitative data whose
interpretation is not furthered by our experiments, and we have discovered no
laws as the exact sciences know law . We possess only large masses of quantita-
tive conclusions nearly worthless for purposes of prediction."
For a full presentation of the absurdity of accumulating facts
merely as facts, and also for an analysis of what constitutes a "scien-
tific" fact, we refer the reader to Professor Hobbs' notable book,
Social Problems and Scientism . In it, Professor Hobbs attacks the
excessive and uncontrolled use of empiricism, and points out that the
result is often what he refers to as "scientism", or what a layman would
call "fake science ." He states that many books and articles have been
written which purport to give "the facts" regarding some phase of
human behavior-the "facts" about marriage, the "facts" about sex,
the "facts" about crime, etc . In all too many instances he says, we
are not then presented with scientific data but with a collection of
scientifically meaningless material (pp . 211-2) .
This mania for "fact-finding" has reached a stage which has .been
sometimes referred to as the "comptometer compulsion ." Morton
Clurman, in How Discriminatory are College Admissions?, in Com-
mentary of June, 1953, calls it the "IBM fallacy ." He says (p . 622) :
"Every trade in every age has its special delusions, and a major application of
social. science might be called the IBM fallacy . This delusion reflects the endemic
convition of 20th-century man that machines can do everything for him-
including thinking . In the case of the social scientist it takes the form of a cer-
tainty that if you feed enough data through enough electric circuits what you are
looking for is bound to come out. The corrollary of this hypothesis is the convic-
tion that only a minimum of human cerebration need be combined with a maximum
of electronics to produce miraculous results .
"* * * The laboratory experiment, or natural observation, which are analagous
to the collection and processing of data in the social sciences, are simply ways of
verifying the scientist's hypothesis . They cannot create a hypothesis, only con-
firm one . Where that hypothesis comes from ., God may know, but certainly no
one else does. Where it doesn't come from, however, is a machine or any specific
body of data . If it did, scientific creation would be possible for almost any high
school boy ."
Professor Hobbs calls the mania the "fetish of statistics ." He
writes (Social Problems and Scientism, p . 212)
"An over-emphasis on facts as facts is one of the characteristics of what is
sometimes called the empirical approach . Ideally, empiricism could mean that
the investigators relied solely upon controlled observation and experimental

evidence . Actually, much of the empiricism in social science involves no rigid
experimentation, and the facts are questionable, fragmentary, and slanted .
Empiricism in social science seems to owe its extreme popularity more nearly to
desperation rather than plan . Philosophic and scientific justification for the
type of empiricism generally employed in social science is extremely tenuous .
It seems to spring more from a frantic effort to acquire the external appearance
of science and the accolade of `practicality' than to grow out of any carefully
thought out system of either philosophy or science . * * * A belief appears to
exist that somehow empiricism is more advanced, more modern, than reliance on
reason and logic, such as rationalism involves ."
We quote heavily, throughout this report, from the testimony and
writings of Professor Hobbs because his testimony before us was so
lucid, impressive and seemingly incontrovertible . Lest it be thought
that Professor Hobbs is alone in his observations and opinions, we
shall quote, in support, letters to Counsel from three of the most
eminent and erudite sociologists in the United States . Each has done
extensive research in a variety of fields . Each has published scores
of books and articles of a professional nature . It is unlikely that any
other three sociologists living have such a wide background or such
extensive publications to their credit as these three senior scholars .
They are Professor Pitirim A . Sorokin of Harvard, Professor Carle C .
Zimmerman of Harvard and Professor James H . S . Bossard of
Pennsylvania .
Professor Pitirim A . Sorokin, in a letter to Committee Counsel, said :
"* * * I can state that so far as social sciences are concerned, most of the
foundations certainly favor to an excessive degree empirical research and greatly
discriminate against theoretical, historical, and other forms of nonempirical
research . This one-sidedness by itself would not be objectionable, if (a) empirical
research were not still more narrowed and reduced to either statistical research
or research along the line of the mathematical and mechanical models, or other
imitative varieties of so-called natural science sociology ; (b) if the topics investi-
gated were of some theoretical or practical importance ; and, (c) if most of the
favored researchers were competent social scientists . Unfortunately, in cases of
overwhelming bulk of granted financial help, these three conditions were absent ."
Similarly, Professor Carle C . Zimmerman :
"The tax exempt foundations in the United States have unfairly and undesirably
emphasized empirical research to such an extent that the whole meaning of social
science research has come to be ridden with sham and dubious practices ."
Professor Bossard :
"For some years, I have regarded with increasing apprehension the develop-
ment of what I have called the comptometer school of research in social sciences .
By this I mean the gathering of detailed social data and their manipulation by all
the available statistical techniques . Not that I am objecting to such methods-
my reluctance rather lies in an unwillingness to accept these as the core of research
in human behavior .
"My own interest lies more in the development of qualitative insights. This
accords with my judgment of the life process, that it cannot be reduced to statis-
tical formulae but that it is a richly diversified complex of relationships . The
chief purpose of research for university people, most of whom are limited to work-
ing with small groups, should be weighted heavily in the direction of research in
qualitative insights rather than manipulation of mass data .
"I am particularly concerned with the impression which the recent emphasis
upon the comptometer approach has created among younger sociologists as to
what constitutes social research . The monies and influences of the large founda-
tions naturally do a great deal to set the norms of professional acceptance in a
given field, and it is in this respect, difficult to measure statistically but possibly
of very great importance, that a distinct disservice may be done to sociological
research by an undue emphasis upon any particular emphasis or methodology ."
In his letter, Professor Bossard disqualifies himself as an unpreju-

diced observer, saying :
"* * * I am indicating the reasonable suspicion that I may be prejudiced in
that I have never been able to obtain a single grant from any research foundation
or organization."
He adds, however, that he has had no difficulty in getting research
grants from his University or from people of means who are familiar
with his work . The conclusion is reasonable that this eminent professor
cannot obtain foundation grants because his interests in research are quali-
tative and not empirical, a rather sad commentary on the objectivity of the
foundations . Nor is he alone in being discriminated against because of
his research theories . This Committee is confident that an analysis would
show that it is far from easy for academicians of Professor Bossard's re-
search persuasions to obtain grants from the major foundations .
The following discussion, by Professor Rowe in his testimony, of
research as promoted by foundations is illuminating :
Dr . ROWE . That is one of the most difficult things to get agreement on, as to
what the objectives of research should be . The easiest, quickest way to get
massive results is to engage in fact-finding for fact-finding's sake, or the mass
accumulation of facts for the sake of accumulating facts . This produces stuff
that is big and heavy in your hand, but I don't think it is any more valuable, to
put it mildly, than the kind of research that allows a scholar the time for reflection
and contemplation, out of which come many of the ideas and thoughts which alone
can make valid framework for analyzing the great masses of data that may be
accumulated, many times by people who don't have much capacity for effective
thinking or for theory or don't have much inclination for that kind of thing .
Asked later if he thought there had been an over-emphasis on em-
pirical research as financed by the foundations, he testified as follows :
Dr . ROWE . It would be very difficult for me to answer that question vis-a-vis
all research sponsored by or supported by all foundations because I just don't
have the knowledge necessary to make that kind of a comment . Taking it out-
side of the field of foundation support, I do think in my own field for example,
the general field of political science, there has been an overemphasis upon empirical
research at the expense of theoretically oriented thinking and analysis . There is
a tremendous emphasis upon the census type of thing in political science . Sta-
tistics are coming into greater and greater importance . Whereas, this is of course
always a valid tool'for research workers, the emphasis here tends to detract from
the kind of fundamental thinking about great issues and about values which
characterize the work of earlier students of politics in the United States, such as
for instance, President Wilson, and people of that kind . Those studies, of course,
were rooted in history and rooted in law . To the extent that political scientists
have tried to divorce themselves from historical and legal study, and from historical
and legal background in their study, they have tended to become very pointed
fact-gatherers, census-takers and the business of arguing about great issues has
been played down to this extent .
Of course, it is much easier and much simpler for political scientists to justify
their existence on the basis of a mass production of factual materials than it is
for them to justify their existence as great thinkers, because fact-gatherers are a
dime a dozen and people who can think are hard to find . This is a comment on
the fallibility of human nature . After all, political scientists are human beings .
Mr . HAYS . Professor, is what you are saying, in other words, that thinkers
could not get the products of their thinking across because the people would not
be able to comprehend and they can comprehend statistics?
Dr . ROWE . No ; I don't mean to imply that . I mean to say that ideas and
concepts and values are far more important, it seems to me, than much of the
indisputable, completely noncontroversial factual material that political scientists
seem to occupy themselves with so much in the present day . (Hearings, pp .
531, 532 .)
W TAX-EXEMPT -FOUNDATIONS
These words of Professor Rowe impress us greatly . It is the position

of this Committee that foundations should have the greatest possible
freedom of operation consonant with the protection of our society and
our institutions . But if it is true, and the evidence persuades us it is,
that the large foundations are financing researchers who are almost
exclusively empiricist, the saturation of the academic atmosphere with
this particular' and narrow approach could have very serious effects
upon the colleges and secondary schools .
It may well be that we are not competent to evaluate research
methods. We are not certain that this is so, for we have the impres-
sion that the executives of the foundations and the clearing house
organizations make more of a mystery of the social sciences, and the
methodism in them, than is justified . But we do not see how Congress,
in any event, can regulate methods of research, nor should_ it wish to .
What we do urge is that the trustees of the large foundations make it
their business to determine reason and balance for themselves, seeking
the advice not only of their own executives and professional employees
but also of those academicians who represent the critical point of
view, those who believe, as Professor Rowe said, that "ideas, and con-
cepts and values are far more important" than mere "factual material",
however the latter may be useful as contributive material .
These trustees might well alert themselves to the dangers and limita-
tions of the empirical method as a primary approach to social problems .
They might well become more conscious also, of the necessity of a
foundation justifying its tax-exempt status through a positive demon-
stration of strong contributions to the public welfare, and not being
content merely to "experiment" with that welfare .
LIMITATIONS AND DANGERS .
This Committee wishes to make it clear that it has not attacked, and
does not attack, empiricism . To do so would be an absurdity . To
allege any implicit vice in empirical research as such would also be
palpably ridiculous . It is the excess and the misuse of empiricism and
empirical research which appears to this Committee to merit criticism .
Mr. Pendleton Herring in the statement which he filed with the
Committee as President of the Social Science Research Council, re-
ferred to John Locke as the philospher "who also developed the doc-
trine that knowledge is derived from experience ." Surely, Locke and
philosophers like him believed in the importance of empirical think-
ing. But we are sure they believed that observations should be based
on actual conditions with all facets of a condition taken into consider-
ation. Much of the empiricism in which foundation-supported research
today indulges seems to eliminate all but quantitative, statistically manip-
ulative variables, and eliminates the qualitative factors which Locke and
any other respectable philospher would have deemed essential .
The very term "social sciences" is misleading because it is so often
identified with the same scientific procedures employed in the natural
sciences ; many, seeing the word "science" mistakenly conclude that
social science results are equally exact and accurate .
Professor Hobbs emphasized in his testimony that the social
scientists supported by the foundations have failed to alert the public .
to the unscientific character of much of what is called "social science ."
On the contrary, the attempt has been made "to convince the readers
TAX-EXEMPT: FOUNDATIONS 67
of the textbook, and trade books," that what they are . reading' is
"science" when in fact it is not . He said (Hearings, p .' 122):
I think it should be the burden and the positive responsibility of persons making
the study and publishing the study . If they call it science, it should be their posi-
tive responsibility to point out the limitations, and not only, point them out, but to
emphasize them to avoid misleading the reader into the belief that it is science in
the same sense that it is used in physical science .'
There has been a growing movement to apply the methods used in
the natural sciences to research in the social sciences, But a complete
translation of these methods into the social sciences is impossible.
There are a number of reasons for this . Perhaps the most important
is that experiment, except in a very limited way, is not available to the
social scientist . The natural scientist, as part of the . procedure of
investigation, tests a hypothesis through experiment . upon the materials
to which the hypothesis applies . The social scientist deals with
human beings ; these he cannot easily use for experimental purposes .
He cannot, use them as one, would use a simple raw material or even
lower forms of life in natural science experimentation . Even, under,
a dictatorship which offered him human sacrifices for his experients,
he could rarely isolate individual factors, traits and conditions, making
them independent of the complex of factors in individual and group
human life . He cannot be certain that he is dealing with one factor
at a time . He cannot exercise the controls which are used by natural
scientists, on materials simpler than human-beings, in order to elimi-
nate error in observation and conclusion when tests are to be applied .
He cannot, . for example, test people to see whether they or society
would be better off if they had extra-marital sex relations .
DID. - KINSEY COUNTS NOSES .
The social' scientist, therefore, falls easily into the use of mere
observation (empiricism) as a substitute for .' experiment . Unable to
use the experimental method,, he takes statistics, he "counts noses ."
This processs is subject to many possibilities of error . It is a process
which is valuable in research, but it must be controlled by specific
hypotheses ; even then, the results will generally be only of qualified,
contributory usefulness . Studies such as the Kinsey' reports, ,for
example,' might disclose that a certain number of people seem t o
have become maladjusted because of a lack of sex experience at an
early age, or because they maintained the sanctity of the marriage
bond. To conclude, from such limited and questionable observations,
that the general public would be better off through early sex experience
or by ignoring the sanctity of marriage, would be unwarranted .
Various errors of observation would be almost unavoidable in such a
collection of statistical material . Were the interviewed cases truly a
population cross-section? Were the cases selected at random, or
only by the volunteer method? Did all the cases tell the' truth?
Was there a check made (and could there be?)' to take into account
the relationship between volunteering and "normality?"
To arrive at a conclusion as to advisable behavior (or as to laws
desirable in the field of sex) merely on the basis of such statistical
material, would fail to take into account many basic premises in
social reasoning, such as : the effect of tentative proposals upon our
standards of morality ; their effect upon the construction of the state ;
their effect upon the family and upon the rearing of children ; and their
effect upon the mental and social health of individuals left free of
moral restraint.
All that a study such as a Kinsey report can prove is that "other
forms of sexual behavior, such as pre-marital intercourse, prostitution,
extra-marital intercourse, and homosexual behavior sometimes occur
among some members of some segments of the population ." 14 Many
years of labor were spent, and very large amounts . of the public's
money, contributed by the Rockefeller Foundation, were expended,
to produce this stupendous fact-
.- This is perhaps as good an example
as any of the extremely limited positive value (combined with ex-
tremely grave possibilities of adverse social effect) of much of the
empirical research in the social sciences, research for which the public's
money is employed through foundation grants .
Though empiricism has its essential place in scientific investigation,
its use is dangerous except within the control of accepted social
premises . To use it alone and to base conclusions solely upon the
method of observation, is to jump to conclusions-to violate the
cardinal principle of scientific investigation that there must be cross-
checking through the alternate use of the inductive and the deductive
method and by relating to actual or apparent axioms . True, Dr .
Kinsey has claimed that he has not derived any conclusions from his
work. But the advertising of his first report stated that it "answers
and clarifies an almost innumerable number of sex behavior prob-
lems * * * ." The report itself, in the use of terminology, derives
conclusions as clearly as though they were so stated . And countless
persons who should know better, among them many college professors,
have taken up these works and used them to substantiate their own
conclusions as though these were Kinsey's . Professor Llewellyn
of the Columbia University Law School went so far, in connection
with the first Kinsey report, as to recommend that pressure should
now be brought on the lawmakers to change our laws regarding sex
behavior. Professor Maclver of Columbia proclaimed that the
Kinsey report would now "prepare the way for a happier and more
enlightened program of public education ."
Other writers travelled the same road . Dr . R. L . Dickinson, in a
preface to American Sexual Behavior and the Kinsey Report, said :
"Surely new programs are indicated . We need to start with parents, educat-
ing them to. educate their children . Then we can educate the educators-teach-
ers, doctors, ministers, social workers and all concerned in the sexual patterns
which Professor Kinsey finds are set so early in life . First and foremost we will
train for attitudes . Later we will teach techniques ."
The danger of such loose and isolated, uncontrolled empirical
studies, particularly when given the seeming authority of support by
a major foundation, is great . As Prof . Hobbs has put it regarding
Kinsey
"Despite the patent limitations of the study and its persistent bias, its con-
clusions regarding sexual behavior were widely believed . They were presented
to college classes ; medical doctors cited them in lectures ; psychiatrists applauded
them ; a radio program indicated that the findings were serving as a basis for
revision of moral codes relating to sex ; and an editorial in a college student news-
paper admonished the college administration to make provision for sexual out-
lets for the students in accordance with the `scientific realities' as established by
the book ." (Social Problems and Scientism, p . 93 .)
Hobbs, Social Problems and Scientism, p . 94 .
Prof . Hobbs narrates many such reactions, among them the statement
in About the Kinsey Report, by Donald Porter Geddes and Enid
Curie, published as a Signet Special at 25 cents :
"It does not matter that the repcrt is unscientific, the important thing is that
it be publicized and serve as a basis for reform of sexual behavior and of laws
which deal with violations of sexual mores ."
The Committee wonders whether The Rockefeller Foundation, which
made the Kinsey study possible by the investment of substantial
funds, is proud of its work . Research of this type, of which there
is much outside the sex field, seems predicated upon the premise
that what is wrong with our society is that our moral codes are
seriously in need of re-study and revision .
These excerpts from Professor Hobbs' testimony before this Com-
mittee are illuminating (Hearings, p . 124)
The CHAIRMAN . As I understand, you are raising a question about the scientific
approach which Dr . Kinsey made in conducting this research in the first place,
and then some of his comments and conclusions which he wrote into his report
which did not necessarily arise from the basis of his research which he had made
Dr . HOBBS . Yes, Sir .
The CHAIRMAN. And which might have damaging effect on the psychology of
the people, particularly the young people of the country .
Dr . HOBBS . Yes, Sir .
The CHAIRMAN . And at the same time undertaking to give to the country the
overall impression that his findings and his comments were based upon a scientific
study which had been made, as the basis of a grant .
Dr . HOBBS . Yes, sir ; a scientific study of the type by implication which you
have in physics and chemistry, and, therefore, its conclusions cannot be challenged .
The CHAIRMAN . Enumerating in the preface that it was made by a grant from
one of the foundations giving it further prestige, possibly, that it was of scientific
value, and so forth .
Dr. HOBBS. That would be correct. I have a statement to that effect to show
that very type of influence, which I will come to a little bit later .
Dr. Hobbs' detailed testimony is well worth reading. Considerable
criticism was made of Dr . Kinsey's work on the basis of statistical
theory and because the impression was left that the study made upon
a selected number of persons produced a result projected to the entire
population of the United States .
Dr. Hobbs, moreover, criticized the Kinsey reports for referring to
"socially approved patterns of sexual behavior" as "rationalization" .
That is :
* * * socially approved patterns of sexual behavior are frequently referred
to as rationalization. That is, the socially approved patterns of sexual behavior
throughout the Kinsey works are referred to in terms of ridicule, as being mere
rationalization, and justifications for types of behaviour which by implication
are not the best or even the most desirable .
Socially condemned forms of sexual behavior and criminal forms of sexual
behavior are usually in the Kinsey volumes referred to as normal, or normal in the
human animal.
The presentation of moral codes, codes of sexual behavior, is such that they are
contrasted with what Kinsey calls normal mammalian behavior, which could give
the impression, and it gave the impression to a number of reviewers, that things
which conform to the socially approved codes of sexual conduct are rationaliza-
tions, not quite right, while things which deviate from it, such as homesexuality,
are normal, in a sense right . (Hearings, p . 126)
Prof. Hobbs stressed the danger that pseudo-scientific studies could
condition the conduct of the public . Statements and conclusions pro-
duced by a scientistic rather than scientific approach could even
severely impair public morality . He testified (Hearings, p . 129) :
* * * But what I am trying to illustrate is the manner in which studies can
influence important aspects of human behavior. I don't mean to impugn Professor
Kinsey's motives, nor the motives of the members of the foundations or anything
of that :type. I am merely ; saying that this can happen and this is an illustration
of where it does happen .
For an illustration, in connection with the question of heterosexuality compared
with homosexuality, Kinsey in the first volume has this statement :
"It is only because society demands that there be a particular choice in the
matter (of heterosexuality'or homosexuality) and does not so often dictate one's
choice of food or clothing.
He puts it in terms of it is just a custom which society demands .
In the second volume it is stressed, for example, that we object to adult molesters
of children primarily because we have become conditioned against such adult
molesters of children, and that the children who are molested become emotionally
upset, primarily because of the old-fashioned attitudes of their parents about such
practices, and the parents (the implication is) are the ones who do the real damage
by making a fuss about it if a child is molested . Because the molester, and here
I quote from .Kinsey, "may have contributed favorably to their later sociosexual
development." That is a molester of children may have actually, Kinsey con-
tends, not only not harmed them, but may have contributed favorably to their
later sociosexual development .
Especially emphasized in the second volume, the volume on females, is the sup-
posed beneficial effects of premarital sexual experiences . Such experiences, Kinsey
states : "provide an opportunity for the females to learn, to adjust emotionally
to various types of males."
That is on page 266 of the volume on females .
In addition, on page 327 he contends that premarital sexual experience may well
contribute to the effectiveness of one's other nonsexual social relationships, and
that many females-this is on page 115-will thus learn how to respond to socio-
sexual contacts .
On page 328, that it should contribute to the development of emotional ca-
pacities in a more effective way than if sexual experiences are acquired after
marriage .
The avoidance of premarital sexual experience by females, according to Professor
Kinsey, may lead to inhibitions which damage the capacity to respond, so much
that these inhibitions may persist after years of marriage, "if, indeed, they are
ever dissipated." That is from page 330 .
So you get a continued emphasis on the desirability of females engaging in
premarital sexual behavior. In both of these volumes there is a persistent em-
phasis, a persistent questioning of the traditional codes, and the laws relating to
sexual behavior . Professor Kinsey may be correct or he may be incorrect, but
when he gives the impression that the findings are scientific in the same sense as
the findings in physical science, then the issue becomes not a matter of whether he
as a person is correct or incorrect, but of the impression which is given to the
public, which can be quite unfortunate . (Hearings, pp . 129, 130 .)
It is difficult for this Committee to understand the propriety of
The Rockefeller Foundation supporting the dangerous sociological
experiment which the Kinsey reports constitute . To use the public
money to produce such socially dangerous material as a "best seller"
seems beyond all reason .
Not only is there the danger that the public itself can be directly
affected by the impact of works of this kind, but it seems to follow
that many take up pseudo-scientific results, treat them as established
scientific verities and use them for propagandizing for changes in
morals, ethics and law . Here are some further examples of this .
Anne G . Freegood in the leading article in the September 1953
Harpers, Dr. Kinsey's Second Sex, refers to Kinsey as "the American
prophet crying in the wilderness, make straight in the desert a path-
way for reform ." She proceeds :
"The desert in this case is our current code of laws governing sexual activities
and the background of Puritan tradition regarding sex under which this country
still to some extent operates ."
She speaks of the "torrent of reaction" that followed the publication
of the first Kinsey book . Later, she says that the second (then forth-
coming) book
"has gained momentum from the effect of its forerunner, which has already been
cited in court decisions and quoted in textbooks as well as blazoned from one
end of the country to the other."
Dr . Hobbs referred to a book which was edited by one Albert Ellis,
and published in 1954, called Sex Life of the American Woman and
the Kinsey Report, in which an attorney writing in this volume,
says : "It may sound strange to say that the most encouraging note
about the new Kinsey Report is its indication that more and more
women are beginning to commit more and more sex crimes ." (Hear-
ings, p . 130.)
Dr. Hobbs cited statements by a prominent clergyman who labeled
social science research as a form of religious devotion .' Referring to
Kinsey's findings this clergyman states :
"These results are the facts with which the moralist will have to work and
build ."
The same clergyman also said :
"Yet we cannot go back to the legalistic morality which' has prevailed so long .
That has really outlived its usefulness if the Kinsey books are right ."
And again :
"That legalistic conformism has outlived its usefulness by about 2,000 years, if
the New Testament is right. It is an emeritus ethic, due at least for honorable
retirement ." (Hearings, p . 130 .)
The responsibility of The Rockefeller Foundation for financing the
Kinsey "best sellers" comes sharply home to roost in a quotation
offered by Dr. Hobbs from an article in Harpers Magazine written : by
one Albert Deutsch (Hearings, p . 131) :
"So startling are its revelations, so contrary to What civilized man, has been
taught for generations, that they would be unbelievable but for the impressive weight
of the scientific agencies backing the survey .
That,
said Dr . Hobbs,
is the unfortunate thing that you have involved here . I do not mean-.that
the foundations meant it to be that way . I do not mean even that Professor
Kinsey meant it to be that way . But unfortunately the public does get,that
impression-that this is something that is final' and infallible, which you cannot
and should not question . I think that is extremely unfortunate. [Emphasis
supplied .]
Further illustrations were given by Dr . Hobbs (and there are more
starting at page 99 of his book Social Problems and Scientism) of the
danger of others promoting pseudo-scientific' material financed by
foundations and using them as a basis for propaganda . He cited 'a
review of the Kinsey Report in the December 1948 issue of the
Scientific Monthly in which a respected psychologist said it recorded
"tremendous implications' for scientists, legislators, physicians and
public officers." He contended that the report "shows clearly that
our current laws do not comply with the biologic facts of normal
sexual behavior ."
In other words, said Dr . Hobbs :
* * * the implication is that the laws should be changed to conform with
biology . If you have a biological urge, the laws should permit you to express
that biological urge as it is demanding on you . (Hearings, p . 131 .)
MORE "SCIENTISM ."

Professor Hobbs was asked by Mr . Hays whether he agreed with
a statement in Mr. Dodd's opening report that foundations are
willing to "support experiments in fields that defy control" . This
colloquy followed (Hearings, pp . 174, 175) :
Dr . HoBBS . It is true that in any study of the significant aspects of human
behavior, such as criminality, juvenile delinquency, political behavior, the studies
are such that they defy control, in the sense that there are intangibles involved
which, no matter how conscientious you are in making the study, these intangibles
still remain .
The word "control" in scientific investigation means that you are able to
control, to measure the significant variables, and that no other variables can
come into the investigation to significantly influence the results .
That is not the case with studies of human behavior .
Mr. HAYS . That is right . But any field, unless it is completely comprehended-
and I don't know that there is any such field-and any research into the unknown
would probably defy control, would it not?
Dr . HOBBS . But there is a difference in the usage of the term . A physicist
can make a study which is a complete controlled study . His study may be one
which involves the weight of matter . He may and can create conditions under
which he has to all intents and purposes complete control over the conditions
of his experiment . You cannot do that in social science, unfortunately .
To quote Prof. Hobbs again, he has said that the
"zealots" of the new research in the social sciences "lead people to believe that
techniques exist in social science which provide accurate description and enable
prediction of social behavior . We are told to pattern our behavior and to change
our society on the basis of such conclusions regarding criminality, race relations,
marriage, mental health, war, divorce, sex, and other personal and social affairs .
Yet in these areas of behavior the pertinent knowledge is extremely limited and
unreliable, the rules of behavior are vague and changeable, the techniques are
crude and untested, and even the basic units required for measurement are non-
existent ." 1 Again : "character and integrity are dissolved in the acid ridicule of
cultural determinism ." 16
It seems to this Committee that there is a strong tendency on the part
of many of the social scientists whose research is favored by the major
foundations toward the concept that there are no absolutes, that everything
is indeterminate, that no standards of conduct, morals, ethics and govern-
ment are to be deemed inviolate, that everything, including basic moral
law, is subject to change, and that it is the part of the social scientists to
take no principle for granted as a premise in social or juridicial reason-
ing, however fundamental it may heretofore have been deemed to be under
our Judeo-Christian moral system .
Perhaps as good an example as any of scientism is the successive
methods which social "scientists" have given us by which to raise our
children . Each was the last word in the "science" of child psychology .
And each was detracted by the advocates of its successor . The New
York Times of August 15, 1954 reports an address by Dr . Hilde
Bruch, of the Department of Psychiatry and Pediatrics at Columbia
University's College of Physicians and Surgeons, to a session of the
International Institute of Child Psychology that "the time has come
to leave mother and child alone ." She is then quoted as having said :
"One might go so far as to say that an outstanding common factor of the many
different approaches in child-care advice is the recklessness with which they are
recommended as the `best' for the future development of a child, without an effort
having been made to verify these predictions .
Is Social Problems and Scientism, pp . 248, 261 .
16 Ibid, p . 261 .
"Yet they are presented as scientific facts, often with the implied or open threat
that any neglect might injure the child and result in neurosis in the dim and
distant future ." [Emphasis ours .]
That is a plain accusation that the child psychologists who have
inflicted "scientific" methods for raising children on the public have
practiced not science but scientism .
SCIENTISM AND CAUSALITY.
The principle of causality is a bog into which social scientists are
prone to fall when they attempt to translate the methods of the
natural sciences into the social sciences . Cause and effect relation-
ships are obviously infinitely easier to establish in the natural sciences
than in the social sciences . Human beings are motivated by a complex
of factors : by goals established, in turn, by complex processes ; by
ethical and moral concepts ; by exercises of free will . Some of the
social scientists seem to have wholly rejected the concept of free will .
It is at least debatable whether man has a free will ; to reject the con-
cept outright and to base research and "scientific" conclusions on the
theory that there can be completely ascertainable causality in human
behavior is hardly in itself scientific . These pseudo-scientists excuse
their imperfection by the assertion that they are struggling along the
way-that the natural sciences have progressed much further, but
that they hope to catch up with them . Give us time, they say . We
are a young "science ." Our principle is correct-it is only that we
have not yet learned how to perfect our methods .
This approach of the social scientists has behind it a wholly
materialistic concept of life and behavior . Its natural outcome is an
approach to Marxism-it is not surprising that so many of the social
scientists tend to collectivism . They believe they can satisfactorily
rearrange society ; given time and an improvement of their more or
less mechanical methods, they will find all the answers . It is a
rather pitiful assumption that the springs of human behavior can be
reduced to formulae .
THE AMERICAN SOLDIER .
Professor Hobbs used The American Soldier as an example of a
scientistic approach to an important national problem . This book
was prepared and edited under the auspices of a special committee
of the Social Science Research Council and published by the Princeton
University Press in 1949 and 1950 . It illustrates "the influence of
supposed social science on military policy at a high level * * * ."
(Hearings, p . 150 .) The story is interesting and, in the opinion of this
Committee, tragic .
A group of social scientists, against the constant rei rated opposition
of the military authorities of the United States, managed to "incorporate
their own ideas in a matter of highest military significance against
the opposition of the military of the United States ." (Hearings,
p. 151 .) The incident concerns the methods to be used to discharge
some part of our armed forces at the termination of World War II .
A Research Branch was officially established in October 1941, within
what was known, successively, as the Morale Division, Special
Services Division, and Information and Education Division . This
division came into the control of social scientists, many or most of
them associated with foundation work, and their achievements were
55647-54 6
-74 TAX-EXEMPT FOUNDATIONS
finally lauded in The American Soldier, a project of The Social Science

Research Council . Professor Hobbs told the story in detail (Hearings,
pp . 150, et seq .), of how these social scientists, against the reiterated
opposition of the Army, insisted upon a demobilization method deter-
mined largely by taking an opinion poll of the soldiers themselves .
Frederick Osborn, a trustee of the Carnegie Corporation, in a paper
read at the University of Minnesota in April, 1951, commended the
social engineering involved in The American Soldier project as a
"typical example of social science prediction ." If this statement is
true, it utterly destroys any claim the social scientists may make to
the role of "social engineers ." Mr . Osborn said that "by weighing
the different factors which "would seem to entitle a man to priority"
in discharge, "it would be possible to devise a system of points earned
by each man which apparently would decide the order of discharge
to the satisfaction of the greatest number of men, and hence with the
least injury to morale ." So shallow and fractional an approach to the
problem of what men to release and when, can hardly be deemed a
scientific method . It involved the most 'casual and dangerous pre-
judgment, preevaluation. It assumed that no other factors of im-
portance related to the morale problem . It also assumed that no other
military or political factor was of any consequence .'
Dr. Hobbs made clear that two highly unfortunate results followed .
,First he held that the polling method was certain to result in the de-
cline in morale . He said (Hearings, p. 153) :
* * * If you give members of the armed services the notion that they are to
be and should be consulted on vital military policy, then this fact in itself can
create dissatisfaction, unrest, of the very type of thing which the Secretary
previously had anticipated .
Moreover, Dr . Hobbs pointed out that the method of demobilization
produced by the social scientists was one which failed to take into
account the military necessities of the nation . Prof . Hobbs stated
that our military "sensed or knew that we were going to run into a
situation in Europe with one of our then allies, that is, Russia ." Yet
they were forced to demobilize men in such a manner that effective
units were disorganized and military efficiency was very sadly im-
paired.
"In other words",
said Professor Hobbs (Hearings, p . 159) :
"they pressed the military group, and if they had as their reason the possibility
of Russian aggression and encroachment into European territories, such as actually
did happen, if the military had that in mind, they could not publicly announce
it because Russia at that time was an ally . And from a standpoint of both mili-
tary policy and from a standpoint of diplomatic policy, it was just something
that they could not do . Yet this group pushed them into a position where they
had to do it or accept this point system of discharge which the military con-
sistently opposed ."
The detail of Dr . Hobbs' testimony is this area is well worth read-
ing. For the Army to have been obliged by social scientists to go to the
enlisted man himself for his opinions before promulgating a redeploy-
ment and demobilization policy illustrates the way, accordingg to Dr .
Hobbs, "in which social science can and does encroach on and expand
into areas not only of morality but of politics and in this instance
military policy which was of the very highest order ." (Hearings, p .
161 .)
TAX-EXEMPT : FOUNDATIONS 75
Had immediate use of our armed forces become necessary after
demobilization, the social scientists would have played the major role
in reducing our armed forces to a nadir of efficiency . What had
happened is of the utmost significance . The military policymakers were
defeated by the social scientists . This was another victory in the struggle
of the "social engineers" to gain control of all the throttles of control .
Assuming, from their expertness in a single field, that their judgment is
superior to that of others who are not "social scientists" (even superior in
military matters to the experts of the military arm of government), they
presumed to press upon government a social theory of their own and
managed to achieve superior influence over the military experts . A few
more such victories for "social engineering" might indeed be fatal .
An interesting appendix must be put to this story . When one
scholar had the temerity to question the findings of The American
Soldier he was castigated as "a young man at the periphery of the
profession and hence, perhaps, less heedful of its imperatives toward
discretion ." This statement Dr . Hobbs has characterized as follows :
"If you want to get in with us, watch your step and don't criticize
our work ." (Hearings, p . 162 .)
SOME RESULTS OF EXCESSIVE PROMOTION OF EMPIRICISM
Professor Carle C . Zimmerman of Harvard, in a letter to Counsel
to the Committee dated May 25, 1954, after stating that empirical
research had been unfairly emphasized by foundations, described the
results as follows :
"A . It has made research grants large and expensive and few in number .
"B . A special class of fund getters has grown up who spend all their time
getting funds, and have little time or capacity to do original work .
"C . A special class of administrators of these funds have grown up and research
is dominated by the administrators rather than the persons who pursue ideas .
"D . As a result the large institutions, or a few institutions with prestige, get
the most of the money in large grants . Smaller institutions, or professors there,
get scant encouragement in seeking out new ideas . These large grants are to
big and unity percent wasted and equally brilliant Ph . D .'s, who graduated in
the same classes, get no support at all . In the meantime a careful analysis of
the origins of scientific men who make a mark (Ph . D .'s who finished by 1940
and were outstanding by 1945) show that they come from these smaller institu-
tions . Of course some argue that all the best men are at the big institutions with
prestige but that is not true . Finding jobs for young Ph . D .'s puts more good
over at the small institutions because there are only a very few places each year
opened at the others .
"E . Since social science is concentrated in a few urban institutions and bossed
both at the foundations and at the institutions by `public opinion' men, prosaic
and important aspects of our life (where real social science need .s exist) never get
studied . Illustrations among many possible, it is apparent that no institution
in the United States pays great attention to the problems of our Appalachian-
Ozarkian people, although institutions located in that region do get grants for
extraneous things, involving cultures far away (like South America) . No insti-
tution in our arid west studies the total relations of modern man to arid or semi-
arid conditions . A biologist will turn naturally to dirty pond water, because the
`cultures' he is interested in are found there, but our human ponds do not have
public opinion prestige, and are not generally studies . (These statements are
not a reflection upon any of the provincial groups in America .)
"F . The emphasis upon false empiricism is not only a matter of the biasas of the
`bosses' or administrators, the biasas of the concentrated favored institutions, and
the neglect of the provincial and needed problems for study, but it also has lead
to a malfeasance or injury in method and has harmed the growth of social science .
"1 . Social science is about 95% macroscopically, or broad-scale observa-
tional . It is not inevitably less scientific for that reason, as geology and
astronomy are not less scientific than zoology or chemistry. The extreme
methods of overluscious empiricism on a few prestige problems is as ridiculous

as trying to build a house with the use of a micrometer for each measurement .
"2 . As a result we overstudy certain aspects of a few problems and nerve
touch the others . As a professor, well renowned for his own social science
researches (which have not been supported by the big tax exchange founda-
tions), remarked, `We research ceaselessly upon getting married, but never
study what to do about the problems involved in the act over the next 40 or
50 years.'
"3 . We have many persons who can work out correlation coefficients but
no one so far has told us what they mean in `causal' analysis . Our social
science is increasingly dominated by meticulous clinical procedures and be-
coming more and more illiterate as to logic and common observation .
"4 . As a result we are creating a social science merely which is the doctrine
of a `cult', read only by a few other social scientists, abstruse to the point of
illegibility, valueless for social direction, constantly repeating itself upon
immaterial problems, and ending in an aimless existential philosophy . As a
prominent European philosopher indicated clearly within the past decade,
`modern social science is becoming an aspect of the existential philosophy of
decadence .' (This is a paraphrased quotation from Nordberto Bobbio,
Existentialism the Philosophy of Decadence, New York, 1947 (English Trans-
lation) ."
Professor Zimmerman then commented on the undesirability of
excessively training researchers in the empirical approach . He said
that :
"the overemphasis upon empirical training and support led to a division in the
social scientists between those who follow abstruse theoretical `systems' and those
who follow equally abstruse pointless research . Our abstruse theoretical systems
have become increasingly only taxonomic (classifying a society into minute details
according to one scheme or the other) and useless repetition . There is little or no
integration between theory and research, because they deal with different things .
As a result the empiricist has no theoretical foundation for valid conclusions .
"To illustrate this, without citing names, one man gathered numerous empirical
facts upon the existence and widespread use of small scale torts within our society
and came to the conclusion that torts (he did not use this word because he had
only empirical training) should all be classified as crimes . Another group gathered
a million facts of the same nature in regard to sex ramification and came to the
conclusion that there should be no social control of sex . Both studies were, in
the opinion of many thoughtful persons, extremely socially disadvantageous and
misinforming and both received tax exempt support in large sums .
"As a result of this I feel that the whole emphasis in training, as dominated by
our tax exempt foundations, should be overhauled . Our research of an empirical
nature is so unrelated to theory that it becomes interpreted in extraneous surface
philosophies, socially harmful, and of no material meaning . (I can prove this but
it would involve me into polemics, and that I consider inadvisable in a public
document .)
"One of the aspects and results of this, is the general feeling that social science
should have no àim' no ùtility', but should be a `study for studies sake .' `We
might discover something which will be good fifty years from now', is a shibboleth
of this school . Now cast back to 1900, and tell me what could have been dis-
covered by such an activity then, which could have been valuable in the changed
social conditions of today? The idea is ridiculous . Yet this feeling is most preva-
lent in the groups who have the easiest access to tax exempt foundation funds .
On the other hand, it is fitting with our culture that the activities of men should
aim to do some `good' or create some understanding . Directly or indirectly, I
imagine these foundations are created by funds from persons who are in the very
high brackets of taxation, and the public, in a large sense, supports almost entirely
these exaggerated empirical falsities . Now just why should the public contribute
to an activity which has no social aim?"
MORAL RELATIVITY.
In answer to Counsel's question whether the over-balance of em-
piricism did not result in the promotion of "moral relativity," Pro-
fessor Hobbs testified as follows :
Dr . HOBBS . In this type of empirical approach, by definition you must attempt
to reduce the things you are studying to the type of units which I indicated yester-
day, to quantitative units, which are measurable . By the very nature of the
approach, therefore, you exclude intangibles, such as sentiments, love, romance,
devotion, or other tangibles, such as patriotism, honesty, and things of that type .
So if it is strictly empirical, then the behavior involved is reduced to cold quan-
titative items which are important, perhaps, but which if presented alone give a
very distorted picture of love or sex or patriotism or whatever else the topic may
be .
Mr . WORMSER. Is it analogous, perhaps, to use a syllogism without including
all the premises? The missing premises being moral codes and basic principles
of government and so forth .
Dr . HOBBS . It would be analogous to that . I would say that in the context
of the scientific method it is using just one of the elements instead of including
all of the elements which should be involved . That is unfortunate . (Hearings,
p . 172 .)
Professor Colegrove testified on moral relativity as follows :
Then I think on the philosophical side, the psychological side, Harvard went
the same wav as Columbia did . One of the leaders, of course, was William James .
And his book called Varieties of Religious Experience, I think, has undermined the
religious convictions and faith of thousands of young people in the United States .
You know, Mr . Wormser, with all the attacks that have been made upon
religion by certain scientists, by the empirical school, and right at Columbia
University and Harvard University, I think that we are finding among scientists
themselves a realization that science doesn't have all the answers to reality ; that
there are experiences of religion, questions of religious faith, that may, after all,
be just as much a part of reality as the study of the stars or the study of atomic
energy, or anything else .
I see, so far as science is concerned, a move away from the complete control of
empirical thinking and a return to a little more rational or a little more humanistic
consideration for religious principles, moral principles, and ethics .
Mr. WORSMER . You do not think, then, that you social scientists are capable
of producing all the answers?
Dr . COLEGEOVE . Oh, absolutely not . No . No, we do not have all the answers
in social science . We are rather dangerous people to trust implicitly . (Hearings,
p . 574 .)
Professor Colegrove also testified to the effect that an excess of
empiricism resulted in a decline of morality .
The attitude of many social scientists toward moral codes is
evidenced by the discussion of The Promise of Sociology, by Ells-
worth Paris of the University of Chicago, published in The American
Sociological Review in 1938 . Professor Paris said :
"Morals spring from the human struggle and, while every code has a certain
sacredness, yet none is sacrosanct, and all are subject to change . It was our dis-
tinguished chairman, Professor Ross, who once wrote in a book that was highly
and publicly commended by the president of the United States . `We need an
annual supplement to the decalogue .' " [Emphasis ours .]
It is the privilege of any individual to doubt our existing moral
codes. When social scientists presume, however, to approach solu-
tions of human problems, or problems of human relationships, upon
the major premise that there is doubt concerning the validity of our
basic moral precepts, they run counter to what the public is con-
vinced is its own interests . Consequently, this Committee sees no
justification for the use of the public funds which foundation capital
and income represent to finance research with such an approach .
In the letter to which we have previously referred, Professor Sorokin
of Harvard stated that the excessive empirical research which the
foundations have promoted for roughly 30 years has had two results :
"(1) the bulk of this sort of research has been perfectly fruitless and
almost sterile from a theoretical or practical standpoint ;
"(2) some of the investigations, made especially along Freudian and
similar theories (or popularizing this sort of views), have been rather
destructive morally and mentally for this nation ." He said, moreover,
that the "exceptional emphasis on training researchers along (these)
lines, with almost complete exclusion of the theoretical approach, is cer-
tainly undesirable for our society, either from a purely scientific or
from a practical standpoint ."
Professor Sorokin has a book now in process and to be published
this year with the title Fads and Delusions in Modern Sociology,
Psychology, Psychiatry, and Cultural Anthropology . In it, he says, he is
"critically examining exactly all the main currents of empirical
research in the social sciences particularly favored by the founda-
tions-sometimes by colleges and regularly by the United States Navy,
Army, and Air . Corps-spending a considerable amount of funds for
this sort°of research .
One more quote from Professor Sorokin, one of our foremost
sociologists :
"The futility of excessively favoring this sort of research (the empirical) particu-
larly is well demonstrated by its sterility-in spite of the many millions of dollars,
enormous amount of time and energy expended by research staffs . Almost all of
the enormous mass of research along this line in the United States of America for
the last 25 or 30 years has not produced either any new significant social theory
or any new method, or any new technique, or any scientifically valid test, or even
any limited causal uniformity . This sterility is perhaps the most convincing
evidence of unwise policies of the foundations, colleges, and Army, Navy, and
Air Corps research directors ."
SOCIAL SCIENCE RESEARCH IN THE UNIVERSITIES AND COLLEGES .
Some interesting and critical comments were made, in the testimony
before the Committee, regarding the types of research supported by
the foundations in institutions of higher learning . Professor Hobbs,
for example, testified as follows :
Particularly where large grants are involved, the grants tend to be geared into
programs of "empiricism"-and I wish the word would be kept in quotes when-
ever it is used here-and then graduate students receive their training through
these grants . I don't mean to imply in any sense that the foundations have
organized their grants for this purpose, or that they are promoting intentionally
and purposefully the type of thing I am going to describe . I merely wish to
point it out as a situation which_ does arise and which I believe is quite, unfortunate .
These graduate students, who, of course, will be the researchers and the teachers
of the future, are subjected by the very nature of the situation to enter in dis-
proportionate numbers into this one small area, an important area, to be sure,
but just one area of their training . They are encouraged through the situation
to embark upon study projects which are extremely narrow, and with the aid of
the grant, the persons running the research are able to employ professional
interviewers, for example . One part of graduate training should be some acquaint-
ance with people . The graduate student, I would feel, would gain much more if
he were to do his own interviewing, rather than merely take the results which
were collected by a professional interviewer . In failing to do his own interviewing,
he has thereby lost an important element, I would say, of what should be his
training .
Furthermore, these projects aid these students to a disproportionate degree .
Other students who, through differing interests, through a broader viewpoint of
society and behavior, who do their own work and who don't have such assistance,
are handicapped in comparison with the ones who receive the aid . through founda-
tion grants .
So that there are cases where the graduate student in his training has concen-
trated in a very small area of the statistical computations-and I wish to add
that in themselves there is nothing wrong with that, but they are a very small
part of the overall picture-but in such training they neglect studies of the
traditions of the country, the studies of the history of the country, they neglect
actual experience with people, they neglect studies of the philosophies which
have been developed in connection with human civilization, and they even
neglect-and this may sound extreme, but I can vouch that it does happen-
they even neglect studies of science .
One of my favorite questions when I am examining students for a graduate
degree is a question of this sort . Here you are, you are going to get a doctor of
philosophy degree . What have you read in philosophy? I appreciate that this
sounds extreme, but there are graduate students who get such degrees' who have
never read a book in philosophy .
Then another question along the same lines : What have you ever read in the
philosophy of science ; and some of them have read little or nothing in that area
either .
So you get this tendency to overspecialize, overconcentrate in one area which
admittedly has its merits, but which leads to a narrowness of mind, not the broader
outlook which we need in the present undeveloped conditions associated with
social science .
Another aspect of this same situation is that graduate students and faculty
members are discouraged from applying for grants unless they, too, are willing
to do this type of "empirical" investigation . (Hearings, pp . 168, 169.)
Professor Hobbs then referred to the bulletin of The Social Science
Research Council regarding the award of research fellowships, which
we have previously described . He pointed out that the bulletin-
* * * does tend in the direction of giving the people in the field the impression
that unless research involves statistical computation, then they don't have much
chance of getting a grant . Now, perhaps that impressionn is incorrect . It may
well be incorrect . I just say that the impression does spread, so that if it does
occur to you to ask for a grant to make a broader study of the history of the
development of social science or something of that sort, then after having read
such things you are likely to be discouraged .
. It may be your own fault . Perhaps if you had gone ahead and requested you
Could have obtained it . I am just saying that atmosphere is created and I think
the foundations themselves would regret that this is the situation and would
probably be willing to do whatever they can to change that atmosphere to create
one which everybody appreciates they arc , interested in, broader types of research
instead of this particular empirical one . (Hearings, p . 170 .)
Professor Rowe made this lucid criticism of foundation practices .
He stated that the former tendency had been to support the training
of individuals, a personnel training program . Now, he said, founda-
tions had turned to an emphasis on sponsoring research as such .
(Hearings, pp . 525, 526.) In particular, he was critical of the co-
operative or group type of research, giving as an example of this
variety of research in which foundations invest heavily, the Tai Ping
Rebellion research project . He testified :
Dr . RowE . You are probably referring to the Rockefeller Foundation support
of a group study at the University of Washington at Seattle . I don't believe
they ever made a single grant of $200,000, but I think the sum of their grants
probably came to that much . This was a grant for the purpose of group research
on the Taiping Rebellion, which was a rebellion which took place in China
during the middle of the 19th century, about the same time as the Civil War
was raging in this country . The importance of this rebellion can be seen from
the fact that historians estimate that 20 million persons lost their lives either in
the fighting as a result of disease, epidemics, destruction, and so forth, that
raged up and down China from south to north during that period of 12 to 14
years, I think . The Taiping Rebellion has long interested historians, and it is
worthy of a great deal of study . Here we get into a rather interesting conflict,
it seems to me, between the attitudes of foundations on the scarcity of personnel
and human resources in the far eastern field on the one hand, and their willingness
to financially support a tremendously narrow focus of interest in research on the
other hand .
There are a large number of highly controversial questions of method involved
here . The question of how to conduct research . There is valid room for experi-
mentation on these matters . But the least that can be said about the University
of Washington project is that it was a rather drastic, in my view, experiment in
the use of the so-called collective-research project, in which the individuals

counted for a good deal less than the team . The team was put together and
people blocked out areas of subject-matter, as I have understood it, and areas of
data and evidence and worked on these, and their results were pooled in the
shape of card files of detailed information on this episode in Chinese history, the
idea being that out of this kind of a team pick and shovel approach, you get a
lot of facts together, and out of these facts will be brought forth a series of
monographic studies .
There is room for this kind of thing, but I always thought they went a little
bit far with it, because I understood-and I beg to be corrected if I am wrong
on this, I have never had any official connection with this project-I understood
that they even integrated into their Taiping Rebellion studies the work of
their doctoral candidates, so that people in Chinese history, for example were
brought in there and given support to write theses on some aspect of the Tai-
ping Rebellion .
I thought that in view of the sacrcity of human resources and the need for
general training on Far Eastern matters, that this was focusing it down pretty
firm . It is a wonderful project from the point of view of research . If you believe
in gadgetry, this had all the gadgets you will ever want to find . If you believe that
the best way to promote research is to pick out highly trained and able people
and set them free in a general field, like Chinese studies, to follow their own
interests wherever they may lead them, then you see this is the very opposite of
that kind of thing . It does achieve a certain kind of mechanical efficiency, it
seems to me, at the expense of inhibiting the kind of thing that Mr . Hays was
talking about, namely, the freedom of the individual to go down any number of
blind alleys he wants to go down in the free pursuit of his curiosity, in the interests
of honestly trying to come up with important things . (Hearings, pp . 530, 531 .)
There is considerable criticism of foundations for their failure to
spread their largess among the smaller colleges . Professor Colegrove
expressed this criticism several times in his testimony . For example :
Then I would like to see the foundations sprinkle more of these research projects
around the small colleges . There is a wealth of brains, a wealth of competence,
in our small colleges and universities, which does not have its share in research
grants at the present time . I would hope that the foundations would give much
more attention to what is going on in the small colleges . The tendency is to con-
centrate this in the large universities, if they use the universities, or concentrate
in the operating societies .
* * * * * *
Mr . WORMSER . Professor, two university presidents told me that they thought
in principle it would, be a good idea to distribute it among the smaller colleges,
but actually it was only in the larger universities that you found the men com-
petent to do research in these various areas .
I think one partial answer to that is that in some of these empirical studies no
talent is required . They are more or less quantitative studies, which a professor
in a smaller college might be able to do just as well as a university professor .
What is your idea as to that?
Dr. CoLEonovE . I would agree with that . There are many small colleges
located near the center of a State where the professor-if he is dealing with the
area situation-could quite easily do a lot of traveling just as well from a small
college as from a large university ; I think the foundations have not yet explored
enough into the talent that can be found in the small colleges .
Of course, there is a tendency for a young man in a small college who gets a
grant and thereby attracts attention to himself to be pulled into a university .
Personally, I regret to see the small colleges raided in this way by the great uni-
versities taking off the faculties of these small colleges-teachers who are doing
so much good for the American people .
The CHAIRMAN . But there would be less likelihood of the so-called raiding both
of the faculty and the graduate students in the small colleges if grants were more
general and made available to the outstanding faculty members and the outstand-
ing students, don't you think?
Dr . COLEOROVE . Oh, yes, quite true . Quite true . We have had a number of
universities that have raided small colleges almost to their destruction . President
Harper of the University of Chicago raided Clark University, took pretty largely
all of its talent to the University of Chicago . But that was before the founda-
tions were greatly operative ; and of course he did it by offering, on the one hand,
research facilities, and on the other hand, much higher salaries than they were
getting at Clark University . (Hearings, pp . 582, 583 .)
The Social Science Research Council, in its publication, Items, of

June, 1952, analyzed the statistics of its grants and reported that 89 .1
per cent of their fellowship grants went to sixteen institutions ; and
that Columbia, Harvard and Chicago universities received 47 .6 per
cent of the total for the period 1925-51 . An analysis of the grants
made by The American Council of Learned Societies will show a lesser
concentration but still a marked favoritism for certain institutions .
The offered explanation of such favoritism is that these schools have,
in general, the best faculties and the best student body . We are not
in a position to judge . It would, however, seem to us important for
the trustees of foundations to consider whether it might be advisable
to distribute their grants in such manner as to increase the number of
institutions which have sufficiently high standards . By a judicious
spreading of grants, it might be easy to raise the stature of some of the
smaller institutions to the standard which the foundation executives
assume is the exclusive property, now, of a few large institutions .
A glance at the list of recent recipients of favor from, and consul-
tants to, the Behavioral Sciences Division of The Ford Foundation
indicates a definite concentration among favored institutions or their
faculties . Of the committees which formulated policies for this Fund,
including a total of 88 persons with university connections, 10 seem
to have been from Harvard ; 8 from Chicago ; 7 from Yale ; 5 from
California ; 5 from Stanford ; and 5 from Columbia . A total of 59
of these men (out of 88) represented 12 institutions . There is addi-
tional significance in the fact that some of these recipients and con-
sultants were on a multiplicity of committees . For example, Pro-
fessor Lazarsfeld of Columbia, was on six ; Professors Carroll of North
Carolina, Merton of Columbia, and Tyler of Chicago, on five ; Pro-
fessors Lasswell of Yale, Simon of Carnegie Tech ., and Stouffer of
Harvard, on four, etc . Counting the number of times each person
with a university connection appears on committees of the Fund, we
reach this representation :
University of Chicago 23
Harvard 18
Columbia 16
Yale 13
North Carolina 8
California 7
Stanford 7
Cornell 7, etc.
Note also that associates of The Rand Corporation are represented 11
times . This interlock with The Rand Corporation is highly interesting .
We must add the intriguing fact that the Behaviorial Science Fund
provided a grant-in-aid program under which each of fifty persons
were to receive $5,000 to be spent at their own discretion for the
purpose of enriching their own work . The associates and consultants
distributed this largess, and included a goodly number of themselves in
their lists .
Note also that The Social Science Research Council took part in
the policy-making of the Fund and that considerable funds were made
available to it and through it .
In the Summer of 1950, $300,000 was given to each of seven univer-
sities and to The Social Science Research Council (beyond other large
grants to the SSRC) . Why this money was concentrated on this
limited group of institutions, we do not know .
This :behavioral Science Fund has vast resources at its command .

Its list of objectives indicates an underlying assumption that human
behavior can be understood as an object of the natural sciences would
be, within the framework of limited numbers of cause-effect relation-
ships . This doctrine is not by any means universally accepted, and
there is the danger that the huge sum available to the Fund to promote
its underlying thesis can make this the ruling doctine in the social
sciences . A full examination of the current and intended operation
of this great fund is indicated, as well as a study of why certain
institutions have been so greatly favored by it .
" THE SOCIAL SCIENCES AT MID-CENTURY"
One of the most important pieces of literature which has come to
the attention of the Committee relating to the methods and accom-
plishments of the social' sciences is the booklet, The Social Sciences
At Mid-Century, published for the Social Science Research Center
of the Graduate School by the University of Minnesota Press . It
contains a series of papers delivered in honor of Guy Stanton Ford,
a former president of the Social Science Research Council, April 19-21,
1951 . In the first of these papers, Frederick Osborn, trustee of The
Carnegie Corporation of New York, admits that all social science is
influenced by preconceived value judgxr .ents . He says that "the
social scientist can at best gather only a few of the facts" and thus
must engage in evaluation . This certainly distinguishes the social
sciences from the natural sciences and gravely weakens the claim
that the natural science processes can be applied to the social sciences .
Mr. Osborn admits that social scientists are only at the "beginning
of knowledge ."
Yet, Mr . . Osborn later makes the claim that the social scientist
"can provide e careful appraisal of the facts" bearing on any "given
problem." and thus give the administrator "new and important tools ."
By inference, however, he admits that this alleged contribution by
social scientists is not scientific for he says that "Experience, judg-
ment and intuition m.ust still play a pert in :making decisions ." The
sum. total of these various statements is that the social scientist does
not know all the facts and cannot collect all the facts but, neverthe-
less, fulfills an important function in giving some of the facts to
administrators . It is easy to see that the emphasis produced by a
selected group of facts might be worse than producing no facts at all,
in so far as it might well imbalance logical decision .
In the same volume, Charles Dollard, president of The Carnegie
Corporation of New York, calls attention to the "widespread suspicion
that social scientists are interested not so much in studying the behavior
of men and the social situations and problems which involve men, but
rather in planning fundamental changes in our society ." However,
he does not expressly deny that this suspicion is warranted . He goes
so far, in fact, as to admit that there are "those who use the label of
social science to validate ideas and programs which are in no sense
scientifically derived ." He adds that "the social sciences have suffered
an incredible amount of damage. through the rash pronouncements of
some of our number on all manner of subjects on which no real scien-
tific data are available and through predictions and forecasts which
have turned out to be lamentably wrong ."
Mr . Dollard includes in his paper the rather startling suggestion,
to which we have referred, that social science should "initiate 'a more

rigorous system of internal policing ." As he expounds his idea, he
intends that such policing should result in higher standards of re-
search . On the other hand, the concept of policing requires police .
The concept is eminently dangerous if any one group is to be granted
the right to use an intellectual nightstick .
Philip M . Hauser, professor of sociology at the University of
Chicago, points out that in the institutions which are most research-
minded, "recognition in the form of promotion, salary advancements,
etc ." depends more on the quantity of research activities and publi-
cations than their quality . This is a sad inferential commentary
on the contribution of foundations to research in the colleges . E17
bridge Sibley, of The Social Science Research Council, in his paper
admits that "the average `quality' of students specializing in the social
sciences both in undergraduate and graduate schools is indeed inferior
to that of those specializing in the `hard' sciences * * *"
The most interesting of the papers is that by Carl O . Sauer, pro-
ffessor of geography at the University of California, entitled Folkways
of Social Science . Professor Sauer said that he came to "admonish",

and he did indeed, severely criticising the research methods and con-
trols promoted by the great foundations and the clearing house organ-
izations which they support in what we have referred to as the "con-
centration of power ." Those who may believe that freedom of inquiry
and freedom of spirit are essential to the preservation of the American
way of life will read these quotations from Professor Sauer's paper
with profit :
"In American social science it has indeed become a dominant folkway to associate
progress with putting the job inquiry into large-scale organizations, under formally
prescribed methods, and with limited objectives . Having adopted the name `science,'
we are impressed by the `method of science' as inductive, quantitative, experimental .
We are even told that such is the only proper method ."
* * *
"The more we get committed to keeping counts and tests going in ever lengthening
series, and to adding suitable items as additional series, the more do the limits of
social science become defined by what may be measured . And thus the more
restricted does the range of personalities and temperaments become who are
attracted into social studies . There is further risk that we attach such merit to
quantification as to confuse means and ends, industriousness with intellectual
achievement ."
• * *
"At mid-century the social sciences have moved far away from where they
stood at the beginning of the century . In numbers of workers they have multi-
plied greatly . Thousands fill the places manned by a few score in those early
years . When memory calls the roll, however, of that elder generation, we look
up to them with respect and admit that they opened up wide horizons that we
in part have lost ."
• * *
"Most of those I knew were detached observers, unconcerned about choosing
or directing their work in terms of social or political ends . (The reform element
came along somewhat later . In my Chicago days this intrusionof emotional
drive was noticeable only in some students of sociology, then already in some
numbers refugees from divinity schools, seekers for a new faith in social welfare .
In economics I saw the welfare motivation come in with the young labor
economists .)" • * *
"We have less and less time for thinking, and again we turn to organization to
simplify and regulate that part of our activity that is left for research . We
acquire space, equipment, manpower, and budgets and put them into a table of
organization as research bureaus and institutes . Obviously, long-term projects
are favored that project an orderly series of steps in the acquisition of data and
of processes for their analysis . Workers are assigned to designated posts and
tasks. Again we have set up an assembly line for mass production, resembling
the operations of industry and government . In some cases the product is sub-
jected to scrutiny, even as to policy clearance . And often a distinction develops
between directing staff and working staff ."
"I think we must admit, however, that more often the idea of an institute has
come first, thereafter the question as to who should run it, and last of all the mat-
ter as to why it was needed. Should not the questions be, Is there a problem
that has become so complex and sufficiently far advanced that an organized and
concerted effort is necessary for further advance, and is it to be under the direc-
tion of the man who has thought himself farthest into this matter? I fear that
not many institutes originate or are maintained thus . We tend to raise up career
administrators, able at finding funds, tactful, energetic operators, who at best
have been scholars too briefly and who by temperament and the course of their
lives become more and more removed from the contemplation and concentration
that are needed for creative work . Thus they may lose even the sensitiveness
and understanding by which they know who a scholar or what a piece of creative
work is ."
"Of all fields, we have perhaps become most given to conferences and com-
mittees for the planning of research . We agree as to division of labor, as to pre-
venting duplication of research, as to priority of topics, as to assembling special-
ists for a cooperative project . In these and other ways unwittingly are we going
about shackling freedom of inquiry . Borrowing a term from the engineers, we
recommend `pilot studies,' serving as models to be reproduced until another de-
sign is approved for another series of studies . Conferences require agenda, and
these have offspring that result in another conference. The common variety of
scholar is awkward, bewildered, and often bored by these uncongenial procedures,
which pass into the control of our entrepreneurial colleagues . Thus we develop
hierarchies of conference members who speak a common language, obscured from us
by its own ceremonial terms. They become an elite, fashioning increasingly the direc-
tions and limits of our work, as they become more and more removed from the
producers ."
"A serious and delicate problem is posed by the growing role of the national re-
search council and foundation, the last years having seen a continually increasing
concentration of influence . Although there are more and more individual workers,
there is no such rise in diversity of interests . With the growth of central advisory,
planning, and granting agencies, perhaps simply as a matter of economy of atten-
tion, it has come about that a reduced number of directions are selected for ap-
proval and support . Thus is introduced a grave and growing disorder into the
body of our scholarship . When preferments and rewards are being posted for
doing certain things and not doing others, the pliable and imitative offer themselves
most freely, and the stubborn ones hold out . Local authority is impressed by the
objectives expressed by the distant patron . He who is not deflected from his
chosen direction to take part in the recommended enterprise is the unhappy guest
who sits out the party . Thus conforming to a behavior pattern comes to prevail .
Yet the able researcher will always know best how he should employ his mind,
and his own inclination will be to seek his own way . The dependent and com-
plaisant ones do not matter . Paved with good intentions, the roads down which
we are being urged do not lead toward the promised land of freedom of the spirit .
No group can or should wish to be wise and farseeing enough to predetermine the
quest for knowledge ."
"Research programs are set up in terms of social goals, and it is assumed that
professional training provides the deep insight needed . Having set up schools for
the training of prophets, it gratifies us to hear that the great task of social science
is to remake the world ."
* * *
"In my experience the talented, original student is the only one for whom it is
difficult to find a place . He may be as likable as another and as willing to work at
the customary tasks of his trade . But it is usually safest not to call attention to
any unfamiliar direction his mind is taking . What the market wants and gets is
persons who can fill job specifications neatly . We dislike having juniors around
who think about matters beyond our ken and reach . We build sheltering walls
against the unknown by making organizations and methods, curricula, and research
programs . And we get no more than we make room for ."
* * *
"Will those who come after us say that we offered protection and encouragement
to young minds differing from our own, that we raised no barriers to seeking and
thinking, that we blocked no paths into the unknown, that we turned no one from
whatever most roused curiosity and gave delight, that we `have loved no darkness,
sophisticated no truth' ? "
THE SLANT TO THE LEFT .
The evidence leads this Committee to the conclusion that the research
in the social sciences with foundation support slants heavily to the left .
A book written by STUART CHASE called The Proper Study of Man-
kind, published in 1948 by Harpers, and written at the instance of
Donald Young of the Social Science Research Council and Charles
Dollard of the Carnegie Corporation to "run a kind of chain and com-
pass line across the whole front of the sciences devoted to human
relations", is illustrative . The book was planned and developed
according to the publisher's announcement "in consultation with
dozens of social scientists in all parts of the country, and Messrs .
Young and Dollard followed the project step by step to its completion ."
The project was initially financed by the Carnegie Corporation and
may fairly be characterized as a project of The Social Science Research
Council; it is virtually an exposition of the SSRC point of view .
Mr. Hays of the Committee questioned whether the book had a
wide circulation . The publisher reported that approximately 50,000
copies had been sold . Taking into account the fact that academicians
and many other people would normally read this type of book out of
the library, its impact must have been great .
Professor Hobbs questioned why a man like STUART CHASE was
selected by foundation representatives to write this particular book
giving a survey of the social sciences . He described CHASE as a man
"who has in his work definitely indicated his leanings toward collectiv-
ism and social planning and that sort of thing * * *" . (Hearings,
p . 134 .)
Professor Hobbs quoted from a book written by the late Congress-
man Shafer and one John Howland Snow, called The Turning of the
Tide, in which the active association of STUART CHASE with the
League for Industrial Democracy (the original name of which was
Inter-collegiate Socialist Society) was delineated . (Hearings, circa
p . 134 .) Prof . Hobbs also quoted from an address by STUART CHASE
to the Department of Superintendents of the National Education
Association on February 25, 1935, in which CHASE said as follows
(Hearings, p . 135) :
"If we have even a trace of liberalism in our natures, we must be prepared to
see an increasing amount of collectivism, Government interference, centralization
of economic control, social planning . Here again the relevant question is not
how to get rid of government interference, but how to apply it for the greatest
good of the greatest number ."
Prof . Hobbs offered a further quotation from a declaration by
STUART CHASE in the NEA Journal of May 1934, that an abundant
economy requires
"the scrapping of outworn political boundaries and of constitutional checks and
balances where the issues involved are technical, * * * ." (Hearings, p . 135 .)
This Committee, like Dr . Hobbs, cannot understand why a man of
STUART CHASE'S obvious leanings should have been selected to
make a "chain and compass" survey of the social sciences . The book
he produced with foundation support seems replete with what might
have been expected of him, including, as Prof . Hobbs explained
(Hearings, p . 135, et seq .), a promotion of the completely false notion

that the methods of the physical sciences can be translated to the social
sciences .
In his book MR . CHASE said (Hearings, p . 137) :
"I am grateful to J, Frederick Dewhurst, Charles Dollard, John Gardner,
Pendleton Herring, Ralph Linton, H . A . Murray, Talcott Parsons, Don K. Price,
and Paul Webbink for a reading of the manuscript, but I am, of course, responsible
for the final draft ."
We understand that all the persons mentioned have been actively
associated with foundations or heavily supported by them . The
conclusion seems fair that they have endorsed Mr . Chase's ideas and
that they themselves lean strongly to the left or at least strongly
support that scientism which seems to produce or be an ally of leftism .
Indeed, Mr . Charles Dollard, in his statement filed with the Com-
mittee in behalf of The Carnegie Corporation of New York, of which he
is President, registered wide approval among social scientists . He
said :
"* * * competent authorities who reviewed The Proper Study of Mankind
found no lack of balance in Ma . CHASE'S treatment of the various social sciences ."
(Hearings, p . 988.)
The approach advocated by the author and supported by founda=
tion funds derogates conventional morality . He says :
"Social science might be defined on a high level as the application of the
scientific method to the study of human relations . What do we know about
those relations that is dependable? The `wisdom of the ages' obviously is not
good enough as the state of the post-war world bears eloquent witness ."
* * * * * * *
"The scientific method does not tell us how things ought to behave but how
they do behave . Clearly, there is no reason why the method should not be
applied to the behavior of men as well as to the behavior of electrons ." (Hear-
ings, p . 138.)
The author, continuing with the following statement, gives the
impression that there is no substantial difference between social
science and natural science :
"There are social experiments and physical experiments, and the scientific
method can be used most advantageously in both ."
Upon which quotation Prof . Hobbs commented as follows (Hearings,
p . 139) :
"I would like to interject, again, there are social experiments and there are
physical experiments, but I would like to point out in the physical experiments
you are dealing with electrons and . things of that type . With the social experi-
ments you are dealing with human beings and it makes quite a different situation ."
The author also commits the error of presenting an unbalanced set
of ideas . There is, for example, testified Prof . Hobbs, a stress on
"cultural determinism", a doctrine which is subject to very serious
doubt . As Prof . Hobbs put it (Hearings, p . 139) :
"Sir, it is not a matter of there being no validity whatsoever . It is a matter
of a theory of this type being presented to the public with the weight of the
foundations behind it, as though it were the scientifically proved fact . In that
context, it is not correct ."
The book discusses in some detail the theory that by manipulating
society you can change not only society itself but also the people
in it . "Theoretically," says the book, "a society could be completely
made over in something like 15 years, the time it takes to inculcate
a new culture into a . rising crop of youngsters ." (Hearings, p . 141 ;)
Obviously, "culture determinism" has been a weapon of both

Fascism and Communism . And it might readily be concluded that
the author thought the use of this method desirable . It is a technique,
as Prof . Hobbs pointed out, close to "brain washing" .
The following quotation from the Chase book is truly disturbing
(Hearings, p . 142)
"Prepare now for a surprising universe . Individual talent is too sporadic
and unpredictable to be allowed any important part in the organization of
society . Social systems which endure are built on the average person who can
be trained to occupy any position adequately if not brilliantly ."
This, said Prof . Hobbs, is reminiscent of the Russian (Pavlov's)
experiments. on the conditioning of dogs .
During Professor Hobbs' testimony the question was raised whether
he was not perhaps discussing only isolated books, after which the
following colloquy took place between Counsel and the witness
(Hearings, p . 146)
Mr . WoaMSER. Mr. Chairman, may I suggest to Dr. Hobbs that I think he
ought to make clear, which I believe is the fact, that he does not intend merely
to discuss 3 or 4 books as the only books in this area which have any unpleasant
connotation to him. What he is really doing is giving them as illustrations, per-
haps particularly sharp illustrations, of the use of what he calls scientism and its
promotion by foundations. Please answer this yourself, Dr . Hobbs, but isn't
your main thesis that what you call soientism widely promoted by foundations
and that in itself has a deleterious effect on society?
Dr. HOBBS . The thesis is not in the book in relation to the foundations specifi-
cally, but I would say that, speaking in general terms, the thing which I call
scientism is promoted in an appreciable measure by the foundations . And scien-
tism has been described as a point of view, an idea, that science can solve all of
the problems of mankind, that it can take the place of traditions, beliefs, religion,
and it is in the direction of that type of thing that so much of the material in the
social sciences is pointed . I am not saying that we have reached that, or that
many would come out blatantly and say that now that can or should be done .
But it seems to me, and I may be wrong, but it does seem to me that we are going
in that direction, and it is time that we mightt take a little stock of it .
Professor Hobbs criticized the discussion of the "cultural lag"
theory in CHASE'S book, namely that :
* * * technology has advanced very greatly, but that our ideas, our beliefs,
our traditions, have not kept pace with it . Therefore, there is a lag between
the technological advance and the culture, and the implication is that the beliefs,
ideas, sentiments and so on, about the family, the church, about government,
should be brought up to date with the technology, which superficially sounds
reasonable enough, except when you begin to analyze it it really settles down to
being in the first place, a nonscientific notion, because the two things being com-
pared are not commensurable, that is, they have not been reduced to any common
denominator by which you can measure the relative rates of change in between
them. (Hearings, p . 147 .)
This "cultural lag" theory is expressed in the statement filed by
The Rockefeller Foundation
"The experiences of World War I and the painful uncertainties of the post-war
and depression period seemed to reflect a growing and menacing gap between
man's technical and scientific capacity and his apparent inability to deal with
his own affairs on a rational basis ."
The Rockefeller Foundation has long been addicted to the cultural
lag theory. As early as 1922, Beardsley Ruml recommended to the
Laura Spelman Rockefeller Memorial Fund that it enter the field of the
social sciences . He advanced that false analogy between the social
and the natural sciences which has led social scientists into "nose-
counting" and a mathematical approach to the solution of human
problems . He promoted the idea that the collection and tabulation

of social science data should have greater foundation support . More-
over, he strongly supported the cultural lag theory, saying (as quoted
in Raymond Fosdick's history of The Rockefeller Foundation) :
"Unless means are found for meeting the complex social problems that are so
rapidly developing, our increased control of physical forces may prove increasingly
destructive of human values ."
Such a statement may appear to have some validity at first reading .
Reading into it, however, what is implicit in its point of view and
approach, it proposes that the social scientist can find better ways for
human beings to live together, by reorganizing our ideas, our beliefs,
our traditions, to keep pace with advancing technology .
Professor Hobbs said that the cultural lag notion :
* * * has the implication that we should keep religion up to date, and patriotic
sentiments, ideas about marriage and the family .
Well, if you do this, of course by implication to take an extreme illustration,
then you would have to modify your religion every time there was a significant
technological change with automobiles or airplanes, things of that sort, which
would give you of course a great deal of lack of permanence .
The cultural lag theory has appeared in many if not most of the sociology text-
books with the implication that we should abandon the traditional forms of belief
about the family and religion . Inescapably that tends to be the implication .
The way Stuart Chase puts it :
"The cultural concept dissolves old ideologies and eternal verities but gives us
something more solid to stand on, or so it seems to me . Prediction takes shape,
the door to the future opens, and light comes through . Not much yet, but enough
to shrivel many intellectual quacks, oververbalized seers and theorists, whose
theories cannot be verified ."
At the very time he is talking about a theory which cannot be verified . (Hear-
ings, p . 148.)
An interesting recent example of the prevalence of the "cultural lag"
theory is to be found in a letter dated August 20, 1954 by Edward L .
Bernays, President of The Edward L . Bernays Foundation, to the
New York Herald-Tribune, and published in its issue of August 23,
1954 . Mr . Bernays offers $2,500 on behalf of The Bernay0 Foundation
for a private study centering on the four Brooklyn boys who shortly
before had shocked the public by violent and murderous acts . These
boys had apparently come from good homes and Mr. Bernays'
approach to discovering why they could have gone so wrong is dis-
closed by this . quotation from his letter.
"A terrific gap exists between our ability to control the technological elements of
our society and our ability to cope with societal problems ."
It is very much to be doubted that the "cultural lag" theory can
account for the behavior of the four Brooklyn lads .
Moral relativism and the cultural lag theory strike at the very roots of
the average American's traditional values . Promulgation of such unveri-
fied, pseudo-scientific theories dissolves the belief that religion gives us
certain basic verities upon which we must construct a moral and ethical
life, that certain basic and unalterable principles underlie our system
of government and should be maintained faithfully for the preservation of
our society . It is not our province to prove that such radical theories as
relativism and cultural lag are wrong . It is the responsibility of those
who advance them under the protecting cloak of "science" to prove that
they are accurate and correct . Until such verification has been produced
it is difficult to justify the use of tax-free funds for what is an unscientific

attack on the very fundamentals upon which the convictions of the

American citizen are based .
The statement filed by Mr . Charles Dollard (Hearings, p . 945,
et seq.), as President of the Carnegie Corporation of New York,
supports the selection of MR . CHASE to write The Proper Study of
Mankind . MR . CHASE is held to be, and he undoubtedly is, "an
extremely able writer ." But we have stated that MR . CHASE is
far to the left and thus a strange selection to make for the job of
writing the bible of The Social Science Research Council . This Mr .
Dollard seeks to answer by stating that MR . CHASE just previously
had done a job for the Standard Oil Company of New Jersey . Mr.
Dollard's observation in this regard is a non-sequitur applied in a
frantic attempt to obscure the real issue, which is the pattern of
MR . CHASE'S intellectual background . How about MR . CHASE'S
record of Communist front associations . They will be found in the
Appendix . They do not make him a Communist, but they place
him among those whose extreme leftist tendencies have led them into
the support of many dangerous organizations . What sort of judgment
may be expected from such a man! We find the answer in his adulation
of both Lauchlin Currie and Harry Dexter White whose demise the
nation need not mourn (The Proper Study of Mankind, pages 211, 205) .
"AN AMERICAN DILEMMA"
Just as we cannot understand why MR . CHASE was selected to
write the bible of the SSRC, we cannot understand why Gunnar
Myrdal was selected to make the study which resulted in An American
Dilemma . This project involved an expenditure of some $250,000 of
funds granted by The Carnegie Corporation of New York . The subject
of the study, the negro problem in the United States, was of course
highly desirable . In a preface to the book written by the President
of The Carnegie Corporation it is explained that because the subject
is charged with emotion it was felt desirable to select as a director
"someone who could approach the task with a fresh mind, uninfluenced
by traditional attitudes or by earlier conclusions ." This eminently
commendable statement, however, contrasts with the fact that
Gunnar Myrdal, a Swedish social scientist, was selected . Dr . M yrdal
was and is a socialist . How an unbiased point of view could be
expected from one of Dr . Myrdal's persuasion we cannot understand .
The following quotations from the book itself indicate Dr . Myrdal's
bias . They also expound theories regarding the American people and
their government which this Committee finds most unfortunate .
"Indeed, the new republic began its career with a reaction . Charles Beard in
Àn Economic Interpretation of the Constitution of the United States' and a
group of modern historians, throwing aside the much cherished national myth-
ology which had blurred the difference in spirit between the Declaration of
Independence and the Constitution, have shown that the latter was conceived
in considerable suspicion against democracy and fear of `the people .' It was
dominated by property consciousness and designed as a defense against the
democratic spirit let loose during the Revolution ." (Page 7 .)
"This conservatism, in fundamental principles, has, to a great extent, been

perverted into a nearly fetishistic cult of the Constitution . This is unfortunate
since the 150-year-old Constitution is in many respects impractical and ill-suited
for modern conditions and since, furthermore, the drafters of the document made
it technically difficult to change even if there were no popular feeling against
change ." (Page 12 .)
55647-54,-7

"Modern historical studies of how the Constitution came to be as it is reveal

that the Constitutional Convention was nearly a plot against the common people .
Until recently, the Constitution has been used 'to block the popular will : the
Fourteenth Amendment inserted after the Civil War to protect the civil rights
of the poor freedmen has, for instance, been used more to protect business cor-
porations against public control." (Page 13 .)
•
"Another cultural trait of Americans is a relatively low degree of respect of
law and order . This . trait, as°wells
as the,'lother one just mentioned' is of paramount
importance for the Negro problem as jwe )shal1 show,in some detail in later chapters .
There is a relation between these two traits, of high ideals in some laws and low
respect for all laws, but this relation is by no means as simple as it appears ."
(Page 14 .)
•
•
"Undoubtedly the idealistic concept of American law as an emanation of `natural
law' is a force which strengthens the rule of law in America .
"But, in another way, it is at the same time most detrimental to automatic,
unrefiecting law observance on the part of the citizens . Laws become disputable
on moral grounds . Each legislative statute is judged by the common citizen
in terms of his conception of the higher 'natural law' . He decides whether it
is 'just' or ùnjust' and has the dangerous attitude that, if it is unjust, he may feel
free to disobey it ." (Page 16.)
• * * * * * *
"This anarchistic tendence in America's legal culture becomes even more
dangerous because of the presence of a quite different tendency : a desire to
regulate human behavior tyranically by means of formal laws . This last tendency
is a heritage from early American puritanism which was sometimes fanatical and
dogmatic and always had a strong inclination to mind other people's business .
So we find that this American, who is so proud to announce that he will not
obey laws other than those which are 'good' and 'just', as soon as the discussion
turns to something which in his opinion is bad and unjust, will emphatically
pronounce that 'there ought to be a law against .' To demand and legislate
all sorts of laws against this or that is just as much part of American freedom as
to disobey the laws when they are enacted. America has become a country
where exceedingly much is permitted in practice but at the same time exceedingly
much is forbidden i n law ." (Pages 16 and 17 .)
•
"And many more of those unrespected laws are damaging in so far as they,
for example, prevent a rational organization of various public activities, or when
they can be used by individuals for blackmailing purposes or by the state or
municipal authorities to persecute unpopular individuals or groups ." (Page 17 .)
• * * * * * *
"For example, it cannot be conducive to the highest respect for the legal
system that the federal government is forced to carry out important social legis-
lation under the fiction that it is regulating 'interstate commerce,' or that federal
prosecuting agencies punish dangerous gangsters for income tax evasion rather
than for the felonies they have committed .
"So this idealistic America also became the country of legalistic formalism .
Contrary to America's basic ideology of natural law and its strong practical sense,
'the letter of the law,' as opposed to its 'spirit,' came to have an excessive im-
portance . The weak bureaucracy became tangled up in . 'red tape.' The clever
lawyer came to play a large and unsavory role in politics in business ; and in the
everyday life of the citizen . The Americans thus got a judicial order which is in
many respects contrary to all their inclinations ." (Page 18 .)
• * * * * * *
"We have to conceive of all the numerous breaches of law, which an American
citizen commits or learns about in the course of ordinary living, as psychologically
a series of shocks which condition him and the entire society to a low degree of law
observance . The American nation has, further, experienced disappointments in
its attempts to legislate social change, which, with few exceptions,_ have been
badly prepared and inefficiently carried out . The almost traumatic effects of
these historical disappointments have been enhanced by America's conspicuous
success in so many fields other than legislation . One of the trauma was the
Reconstruction legislation, which attempted to give Negroes civil rights in the
South ; another one was the anti-trust legislation pressed by the Western farmers

and enacted to curb the growth of monopolistic finance capitalism ; a third one
was the prohibition amendment ." (Page 19 .)
"If in the course of time Americans are brought to be a law-abiding people, and
if they at the same time succeed in keeping alive not only their conservatism in
fundamental principles and their pride and devotion to their national political
institutions, but also some of their puritan eagerness and courage in attempting
to reform themselves and the world-redirected somewhat from the old Biblical
inclination of thinking only in terms of prescriptions and purges-this great nation
may become the master builder of a stable but progressive commonwealth ."
(Pages 20 and 21 .)
* * * * * * *
"The popular explanation of the disparity in America between ideals and actual
behavior is that Americans do not have the slightest intention of living up to the
ideals which they talk about and put into their Constitution and laws . Many
Americans are accustomed to talk loosely and disparagingly about adherence to
the American Creed as 'lip-service' and even `hypocrisy' . Foreigners are even
more prone to make such a characterization ." (Page 21 .)
Mr. Dollard in his statement filed as President of The Carnegie
Corporation cited other quotations from An American Dilemma which
are kinder in tone toward the American people . It is our opinion
that the sections quoted by Mr . Dollard do not offset the unpleasant
and prejudiced references we have quoted$above . Nor are we im-
pressed with Mr. Dollard's attempt to characterize Dr . Myrdal as a
moderate sort of socialist . Professor Colgrove, who, as Secretary-
Treasurer of the American Political Science Association for eleven
years, ought to know, testified that Myrdal was a "very left wing
socialist" and "very anticonservative." He said :
Dr . Myrdal was a Socialist, pretty1far left indeed extremely left . He was not
unprejudiced . He came over here with all the prejudices of European Socialists .
And the criticism that he makes of the American Constitution, the criticism that
he makes of the conservatives of the United States are bitter criticisms . He
didn't have any praise at all for the conservatives . Re did praise what he called
the liberals. And he implied that it was the conservatives in the United States
who created the problem and who continued the difficulties of any solution. I
felt the foundations did a great disservice to American scholarship in announcing
his study as an objective nonpartisan study whose conclusions were wholly
unbiased . It was almost intellectual dishonesty . (Hearings, p . 577.)
This Committee would be far less concerned about the leftist slant-
ing of so many products financed by great foundations in the social
sciences if there were a reasonably commensurate number (and weight)
of such products slanted in the other direction . There can be no doubt
that the greatest freedom consonant with public responsibility is
desirable in the conduct of foundation work . However, we conclude
that the freedom which most of those who direct the work of the largest
foundations, and some others, insist upon is merely the freedom to
propagate leftist propaganda.
THE ENCYCLOPEDIA OF THE SOCIAL SCIENCES .
This work is one to which closer study should be given than this
Committee was able to give . Though somewhat out of date, it is
still the "Supreme Court" of the social sciences, the final authority to
which appeal is made in any social science field by many students and
researchers . It was estimated as late as 1952 that it was being used
at least a half million times per year . Apparently The Rockefeller
Foundation, The Carnegie Corporation of New York and The Russell
Sage Foundation financed the project or materially supported it . . It
was, clearly enough, a highly desirable venture . But it does seem,
in view of its enormous importance in conditioning the thinking of

reference-users, that every means should have been used by the
foundations who made it possible to see that it was a truly objective
and representative piece of work . Was it? Let us see .
Perhaps a Communist was not so reprehensible a character in the
thirties as one would be today . But a Communist was still a Com-
munist ; objectivity could hardly be expected of him, whether in 1930
or 1954 . Communists have a way of bringing things political into
almost any subject . In the case of the Encyclopedia, Communists
and pro-Communists were permitted to write articles on subjects in
which their slant could obviously be heavily applied, and it was .
The key man in the creation of the Encylopedia was DR . ALVIN
JOHNSON, an Associate Editor . In his book, Pioneer's Progress, he
said
"In enlisting assistant editors, I forebore all inquiry about infection with Marx .
Like a common cold, Marx was in the air, sometimes cutting editorial efficiency,
but not irremediably . * * * I had two assistant editors who asserted that they
were Socialists . That was nothing to me ; they were good and faithful workers .
And one was so considerate of my reactionary bent as to inform me that a new
editor I had taken on was a Communist ."
DR . JOHNSON then told how he interviewed the man and told him he
would keep him on-"Your private political views are you own
business", said the good Doctor . Incidentally, his reference to him-
self as "reactionary" was humor-his own Communist-front associa-
tions have been recorded ; he may certainly be judged as considerably
to the left .
The article on The Rise of Liberalism was written by HAROLD J .
LASKI, a British socialist . He also did the articles on Bureaucracy,
Democracy, Judiciary : Liberty : Social Contract : and Ulyanov, Vladimir
Rich .
Atheism, Modern Atheism was written by Oscar Jassi, a socialist of
Hungarian origin . Bolshevism was written by Maurice Dobb, an
English radical . Capitalism, by Werner Sombart, a socialist who be-
came affiliated with the Nazis .
Communism was written by MAx BEER, a Marxian of the Uni-
versity of Frankfort, Germany . Communist Parties was written by
LEwis L . LORWIN, whose views *ray be gleaned from this state-
ment in the article: "The view common in the United States that the
Communists are either cranks or criminals is largely a reflection of a
conservative outlook ." He also wrote the article on Exploitation .
Corporation, written by two New Dealers, Adolph A . Berle, Jr., and
GARDINER C . MEANS, clearly reveals their bias at that time . (Mr .
Berle has since written The ,20th Century Capitalist Revolution and
repudiated some of his former views regarding corporations .) They
say that the corporation may well equal or exceed the state in power .
"The law of corporations, accordingly, might well be considered as a
potential constitutional law for the new economic state : while business
practice assumes many . of the aspects of administrative government ."
Criticism, Social, was produced by ROBERT MORSE LOVETT, Of
wide Communist front associations . Education, History, was pro-
duced by GEORGE S . COUNTS, a radical educator concerning whom
we shall have more to say in the section of this report on education .
Fabianism was written by G . D . H . Cole, a British socialist . He
also wrote the article on Industrialism . Fortunes, Private, Modern
Period, prepared by LEwIs COREY, is easily recognizable as a Marxist

analysis.
. Freedom of Speech and of the Press was written by Robert Eisler
of Paris who destroys the Christian ethic with this authoritative
pronouncement
"No one today will consider the particular ethical doctrine of modern, or for
that matter of ancient, Christianity as self-evident or natural or as the morality
common to all men . The modern relativist theory of values has definitely
shattered the basis on which such artificial churches as the various ethical societies
orders rested ."
Government, Soviet Russia was prepared by Otto Hoetzsch of the
University of Berlin who gives us kind thoughts about the Soviets-
for example:
"Although the elections are subject to pressure of Communist dictatorship,
this workers' democracy is not entirely a fiction ." [Emphasis ours .]
The article on Labor-Capital Co-Operation is credited to J . B. S .
HARDMAN, whose Communist front affiliations are recorded in
Appendix, Part IX of the Dies Committee Reports, 78th Congress
(1944) . He also wrote Labor Parties, General, United States, Masses
and Terrorism . Laissez-Faire is the product of the socialist, G . D . H.
Cole ; his job was done with a hatchet . Large Scale Production, by.
Myron W . Watkins, is an attack on the production methods of Big
Business .
Morals is the product of HORACE M. KALLEN, whose extensive
Communist-front associations are a matter of record . Philosophy
was produced by Horace B. Davis, with ex-Communist-front associa-
tions (See Appendix IX) . Political Offenders, by MAX LERNER,
a radical, contains a diatribe against the treatment of political
offenders . Political Police, is by ROGER N . BALDWIN, recorded
by Appendix IX as having Communist-front associations . Power,
Industrial, by Hugh Quigley, seems to be a plea for more control of
business . Proletariat is by Alfred Meusel of Germany and seems to
admire the Soviet system in Russia .
Social Work, General Discussion, Social Case Work, is the work of a
Communist-fronter, PHILIP KLEIN . Socialism was written by a
socialist, OSCAR JANSKI . It is not unsympathetic to Communism .
Stabilization, Economic, was written by GEORGE SotJLE, of ex-
tensive Communist-front affiliations . It expresses doubt that "stabili-
zation" can be accomplished under our present order. Strikes and
Lockouts is by JOHN A . FITCH, of wide Communist-front affiliations .
Vested Interests is the work of MAx LERNER .
One of the theses in Woman, Position in Society, by the Communist-
fronter, BERNHARD J. STERN, is that we are not doing right by our
women, while the Soviets are .
This list is not inclusive . Many more instances of radical selection
could be given, plus the multitude of articles by moderately slanted
writers . What is amazingly characteristic of the Encyclopedia is the
extent to which articles on "left" subjects have been assigned to
leftists ; in the case of subjects to the "right", leftists again have been
selected to describe and expound them . This is reminiscent of the
reviews in the New York Times of books on China, in which both pro-
and-con-Communist volumes were assigned to pro-Communists for
review .
"EXPERIMENT", "RISK CAPITAL" AND THE COLLEGES .

The intense application of some of the great foundations to the
social sciences seems, by the evidence, to stem from what amounts to
a current intellectual fad having its origins in the "cultural lag"
theory to which we have referred . It runs that foundations should
not longer expend their funds in helping to create a better and healthier
physical world-it has already advanced mechanically beyond the
ability of human beings to live properly within their new environment .
Foundation funds should now be applied to human welfare in the
social sense . The social scientists are to be able to give us ways of
living together better than those which religious, educational and
political leaders have been able to devise for us in the past . We must
improve "man's relation to man ." This concept, widely touted in
the foundation world, is illustrated by the underlying report upon
which the work of The Ford Foundation was based . It contains this
statement :
"In the Committee's opinion the evidence points to the fact that today's
most critical problems are those which are social rather than physical in char-
acter-those which arise in man's relation to man rather than in his relation to
nature ."
How are the social scientists to accomplish this reform in our social
relations? With financial assistance by the foundations, they are to
"experiment" . We have explained some of the dangers of such ex-
perimentation for which foundations are to "risk" their funds . Here
is part of Professor Hobbs' testimony about it :
Mr . WoRMSER . Dr . Hobbs, do I express your opinion correctly by this state-
ment? The foundations, or some of them, in the Cox hearings last year, main-
tained that the best use of their funds would be in experiment in reaching out for
new horizons, in considering their precious funds in what they call risk capital .
You would approve of experiment in the sense of trying to reach new horizons,
but you would caution, I assume, against experiment as such where it relates to the
relationship of human beings and basic factors in our society?
Dr. HOBBS. Yes, sir ; a great deal of caution, I think, should be applied in those
areas. For one thing, because of the points I tried to establish yesterday, that the
mere fact that the thing is being studied can change the situation ; and secondly,
because the findings of a study can affect human behavior and we should be
extremely cautious when we are entering into areas of that sort . (Hearings,
p . 167 .)
This Committee strongly supports Professor Hobbs' opinion that the
utmost caution should be used when experimentation with human
relationships is involved in a foundation grant or project . We suggest,
moreover, that the trustees of foundations consider carefully whether
they have not been induced by their executive associates to "go over-
board" on the general concept of "experiment." Among the many
letters received by the Committee staff from colleges, criticising the
foundations for failure to contribute direct support, and for preferring
"new projects" is one from Barnard College (Columbia University)
which contains this :
"My only comment about foundation policies is that the foundations all seem
to have the point of view that they should contribute only to `new projects .'
The College's largest problems are to maintain faculty salaries and scholarships at
a reasonable level, and to keep ancient buildings repaired, so that the basic work
of teaching can be continued . It is discouraging to have to add `new projects'
in order to secure foundation support when the financial structure of the college
has not yet become adjusted to the increase in the cost of living ."
The almost frantic search for something new and experimental in
which to invest foundation funds, is a phenomenon with many un-
happy repercussions . Among them is the situation of which this
college administrator complains . Would it not be better, in the long
run, for foundations to give more direct assistance of widespread nature
to sound educational institutions which are dependent on private support,
rather than to waste gigantic aggregates o f money annually on the pursuit
of something "new"?
IX . THE POLITICAL ACTIVITIES OF FOUNDATIONS
THE QUANTITATIVE TEST .

Once a tax-exempt foundation has obtained its initial gift or estate
tax exemption, it may spend all its capital, perhaps hundreds of mil-
lions, in the support of any "ism" it cares to, and by active propa-
ganda . Nothing prevents it from using its capital in political activ-
ity. The only "unless" might be if the Bureau of Internal Revenue,
acting soon enough and on sufficient evidence, were able to prove that
there had been fraud at its inception .
One penalty is imposed by the tax law if a foundation engages in
politics . Its income tax exemption is lost if any "substantial part of
the activities" of the foundation is used for "carrying on propaganda,
or otherwise attempting to influence, legislation ."" Proof that it was
violating this prohibition would mean loss of income tax exemption,
and subsequent donors to the foundation would not be given gift or
estate tax exemption for their donations . But the foundation could go
right on spending its existing principal for its selected "ism" .
Let us look at the quantitative facet of the prohibition . A "sub-
stantial part of its activities" is the test . It is evident that a quanti-
tative test, particularly one so vaguely described, is futile and
impossible to administer . Take Foundation X with a capital of
$500,000,000 and Foundation Y with a capital of $50,000 . Is the
measure of "substantial" to be the amount of money spent, or the
proportion of money spent? Y can do far less harm spending all of
its income for political purposes than can X, spending but one per
cent of its income . The contrast illustrates one of the difficulties of
applying a quantitative test .
Is the test, then to be the amount of energy, or time, or effort
spent on political action? How could that be measured with sufficient
accuracy? Or is it the impact of the work upon society which is to
be measured-and if so, how?
It is true that measures of "substance" are sometimes necessary in
tax and other laws . In this instance, however, it is a futility . The
tax law might better proscribe all political activity, leaving it to the
courts to make exceptions on the principle of de minimus non curat lex .
17 The 1954 Internal Revenue Code added this further condition on tax exemption : °* * * and which
does not participate, or intervene in (including the publishing or distribution of statements), any political
campaign on behalf of any candidate for public office ." The interpretation of this addition by the courts
will be watched with great interest . Among the interesting issues will be this: will attacks on a candidate
for office be construed as activity "cn behalf" of his opponent? Again, where a foundation is the substantial
owner of a newspaper which actively supports candidates, will the foundation have violated this new pro-
vision? Can a foundation any longer safely hold substantial ownership in a newspaper? This Committee
has given little attention to the problems raised by the new wording because it came into the law at the
very end of its research period and because other, less blatant, types of political activity seem far more
important and more difficult to combat .
THE QUALITATIVE TEST .

A reading of the testimony of Internal Revenue Commissioner
Andrews, and his Assistant, Mr . Sugarman, will show that the quali-
tative test of political use is weak ; it has been further enfeebled by
court decisions to the point where it is of use only in the most extreme
cases . Most of the foundations impinging upon the political area
get their tax exemption as "educational" institutions . Yet the
courts have so construed the term "educational" that much that is
truly political propaganda may be justified within that term . Again,
the tax law itself, in referring to "propaganda", ties it in to the
phrase "to influence legislation", so that general political propaganda,
however forceful and forthright it may be, does not deprive a founda-
tion of its exemption . Only propaganda directed at "influencing
legislation" is proscribed, and even this proscription is further
weakened by the quantitative test .
The Committee takes it as axiomatic that, whatever the defects in the
tax law as it stands, foundation funds, constituting public money, should
not be used for political purposes or with political bias or slant . It is
admittedly extremely difficult to draw the line between what is per-
missible as "educational" and what should be avoided as "political" .
Indeed, it may be impossible to find any legislative or regulatory way
to delineate the border with clarity . This Committee offers no easy
answer, but urges that the problem receive intense attention in the
light of our disclosure of political activity by foundations .
THE LEAGUE FOR INDUSTRIAL DEMOCRACY.
One of the more obvious cases of political activity disclosed by the
Committee's research is that of The League for Industrial Democracy.
This very influential foundation became the subject of litigation in
1932 . Its tax-free status was questioned by the Commissioner of
Internal Revenue, but in the case of Weyl v . Commissioner, 48 Fed .
(2d) 811, the tax exemption was supported on the ground that the
foundation was an "educational" organization . We suggest, under
the facts to be related, that the Bureau should revive its study of this
foundation and move against its tax exemption . To continue to grant
this foundation tax exemption would create a precedent for granting
tax exemption to all political parties and political organizations .
The witness who testified concerning the League was Mr . Ken
Earl, a lawyer formerly on the staff of two subcommittees of the
Senate Judiciary Committee-the Subcommittee on Internal Security,
and the Subcommittee on Immigration . Mr. Earl's contention was
that the LID "is an adjunct of the Socialist Party," a contention
which seems soundly concluded from the evidence he produced out of
publications of the LID itself, and accounts of its activities and
proceedings .
[Whenever in the following quotations italics appear, we have sup-
plied them .]
Quoting from a publication of an affiliate, The Inter-Collegiate
Student Council of the LID, Mr. Earl gave their statement of "what
the LID stands for" :
The L. I . D . therefore works to bring a new social order ; not by thinking alone,
though a high order of thought is required ; not by outraged indignation, find-
ing an outlet in a futile banging of fists against the citadel of capitalism ; but
by the combination of thought and action and an understanding of what is the weakness
of capitalism in order to bring about socialism in our own lifetime. (Hearings, p .
740.)

The LID was originally The Intercollegiate Socialist Society, founded
in 1905 after a call by Upton Sinclair and George H . Strobel (Hearings,
p. 740) "for the purpose of promoting an intelligent interest in
Socialism among college men and women." In 1921 its name was
changed to the League for Industrial Democracy . There was a
mass of evidence to show that the aims were not purely socialist
education, but that action, political action, was a purpose of the organi-
zation. The following quotation from the LID publication Revolt
(the very name has significance) illustrates :
"The League for Industrial Democracy is a militant educational movement
which challenges those who would think and act for a `new social order based on
production for use and not for profit.' That is a revolutionary slogan . It means
that members of the L. I . D . think and work for the elimination of capitalism, and
the substitution for it of a new order, in whose building the purposeful and pas-
sionate thinking of student and worker today will play an important part ."
as well as this :
"Men and women who would change a world must blast their way through the
impenetrable rock . No stewing over drinks of tea or gin, no lofty down-from-
my-favorite cloud, thinking more radical thoughts than thou attitude makes a
student movement or a radical movement . L . I . D . students talk and write about
conditions . L. I . D . students act about them .
"* * * a staff of 6 or 8 leave the Chicago or New York offices to help coordinate
activities . They get into classrooms, they talk to classes . * * * In addition
these speakers furnish a valuable link between students and their activities later
on . After graduation the work continues unabated . In city chapters, in New
York, Chicago, Philadelphia, Detroit, Baltimore, the work of education and action
goes on .
"The L . I . D . emergency publication, the Unemployed and Disarm, have
reached a circulation of one-half million . * * * Students organized squads of
salesmen to sell these magazines, containing slashing attacks on capitalism and
the war system, at the same time it enable the unemployed to keep alive .
"In November of this year a training school for recent graduates will be opened
in New York * * * to equip students by field work to perform their tasks in
the labor movement . * * *" (Hearings, p . 744 .)
As Mr . Earl observed : "This language about recruiting and train-
ing, I think, would be more appropriate in an Army field manual than
in the journal of an èducational' association ."
In the same issue of Revolt, PAUL R . PORTER, after using some of the
cliche phrases of Stalin and Lenin, advised workers and farmers
that ". . . their recourse now is to form a political party which they
themselves control, and through which they might conceivably obtain
state mastery over the owning class ." (Hearings, p . 745 .) He added
these paragraphs which indicate an intention to support violent
action :
"When Community Chests are more barren than Mother Hubbard's cupboard
and workers begin to help themselves to necessities in stores and warehouses,
when bankrupt municipalities stringently curtail normal services, then vigilante
committees of businessmen, abetted by selected gangsters, might quickly and
efficiently assume command of governmental functions .
"The assumption of power by vigilantes in a few key cities would quickly
spread . The President (Hoover or Roosevelt) would declare a national emer-
gency and dispatch troops to zones where vigilante rule was endangered . Prob-
ably he would create a coalition super-Cabinet composed of dominant men in
finance, transportation, industry, radio, and the press, a considerable number
of whom would be Reserve officers ." (Hearings, p . 745.)
* * * * * * *
"The bulldozing methods of the war-time Council of Defense would be employed
against protesting labor groups and some individuals might be imprisoned or shot,
though several `cooperative' A . F . of L . officials might be given posts of minor
responsibility."

"Watch now those little flames of mass unrest * * * Great energy will be gen-
erated by those flames of mass revolt . But revolt is not revolution, and even
though new blankets of cruel repression fail to smother the fire and in the end
only add to its intensity, that energy may be lost unless it can be translated into
purposive action . Boilers in which steam can be generated-if we may work our
metaphor-need be erected over the fire, and that steam forced into engines of
reconstruction .
"Trotsky, in describing the role of the Bolsheviks in the Russian Revolution,
has hit upon a happy figure of speech which we may borrow in this instance . No
man, no group of men, created the revolution ; Lenin and his associates were but
the pistons driven by the steam power of the masses . The Marxist Bolshevik
party saved that steam from aimless dissipation, directed it into the proper channels .
"To catch and to be driven by that steam is the function of the radical parties in
America today ."
• * * * * * *
"There are members who would pattern it (the Socialist Party of America)
after the German Social Democracy and the British Labor Party, despite the dis-
astrous experiences of two great parties of the Second International . There are
members who have lost to age and comfort their one-time fervor, and members
who would shrink from struggle in time of crisis ."
• * * * * * *
"They (the Socialists) must overcome the quiescent influence of those whose
socialism has been dulled by intimacy with the bourgeois world, and they must
speak boldly and convincingly to the American working people in the workers'
language .
"If their party can rise to these tasks then perhaps capitalism can be decently
buried before it has found temporary rejuvenation in a Fascist dictatorship ." (Hear-
ings, p . 747 .)
Mx. PORTER was an organizer and lecturer for the LID and a
missionary to thousands of college students . (Hearings, p . 747 .)
The position and objectives of the LID were made clear in an
article in Revolt written by Felix S . Cohen, who said :
"The crucial issue of industrial civilization today is not between laissez-faire
individualism on the one hand and collectivism on the other . History is deciding
that question . The question for us is what sort of collectivism we want .
"Modern technology makes collectivism inevitable . But whether our collectivism
is to be Fascist, feudal, or Socialist will depend * * * upon the effectiveness with
which we translate those political ideals into action .
"You cannot fight on the economic front and stay neutral on the legal or political
front . Politics and economics are not two different things, and the failures of the
labor movement in this country largely arise from the assumption that they are .
Capitalism is as much a legal system as it is an economic system, and the attack
on capitalism must be framed in legal or political terms as well as in economic terms ."
"* * * a Socialist attack on the problem of government cannot be restricted to presi-
dential and congressional elections or even to general programs of legislation . We
have to widen our battlefront to include all institutions of government, corporations,
trade unions, professional bodies, and even religious bodies, as well as legislatures and
courts . We have to frame the issues of socialism and democracy and fight the
battles of socialism and democracy in the stockholders' meetings of industrial
corporations, in our medical associations, and our bar associations, and our teachers'
associations, in labor unions, in student councils, in consumers' and producers'
cooperatives-in every social institution in which we can find a foothold * * * ."
• * * * * * *
"But the need of fighting politically within corporations and trade associations
and professiojpal bodies, as well as labor unions, is just as pressing if we think
that fundamental social change can be secured in this country only by uncon-
stitutional measures .
"In a revolution, when the ordinary political machinery of government breaks
down, it is absolutely essential that the revolutionary force control the remain-
ing centers of social power . In Russia the success of the Bolshevik revolution
rested with the guilds or soviets, which were not created by the Communist
Party and which antedated the revolution . A socialist revolution in this country
will succeed only if our guilds, chief among them our engineering societies, have within
them a coherent socialist voice . (Hearings, pp . 747, 748, 749 .)

We leave to the reader to judge whether such pronouncements are
purely educational!
The "democratic" process was of small concern to the author of
these diatribes . He said : "We do not need a majority" to deal with
"the putrid mess of capitalism ." (Hearings, p . 749 .)
A full reading of Mr . Earl's testimony and of the many quotations
from LID pamphlets and puolications which he cited is necessary
to understand the consistency with which action was urged by the
LID spokesmen . We can only give some of them here to illus-
trate . The quotations from an article by Amicus Most in the De-
cember 1932 issue of Revolt (Record, p . 1678) is one example . From
that same issue comes the following piece of "education" written by
the LID Field Secretary, Mr . Porter :
"Planned as an outgrowth of the conference will be a student delegation to
Washington soon after Congress convenes, to serve notice that hundreds of stu-
dents will reject the role of cannon fodder in another war, to request that the
State Department furnish a list of investments for which American youth may
some day be called upon to fight, and to demand that money now spent in main-
taining the ROTC and the CMTC be used providing relief for the unemployed ."
* * * * * *
"Delegates are already making preparations to attend the traditional Christ-
mas holiday conferences of the LID, which will be held for the 18th successive
year in New York and for the 5th in Chicago . This year's New York theme will
be "Socialism in Our Time" and has been divided into three main categories, to
with : "How May Power Be Won," "Building a Power Winning Organization,"
and "The Morning After the Revolution ." The Chicago conference will be along
similar lines ."
* * * *
"On Armistice Day military-minded former Senator Wadsworth * * * spoke
in Ithaca on behalf of a bigger Army and Navy . Members of the Cornell Liberal
Club, the Socialist Party, and student peace groups held a rival meeting after
which they marched with banners past the high school in which Wadsworth
was speaking . Leonard Lurie, Cornell LID representative, describes their gentle
reception : `Several of the Army officers rushed at us and tore down a few posters .
The police joined the destruction which was over very shortly . They prodded
us along the street with their stick, and Fred Berkowitz remarked, "I wonder
how much the police get for hitting people * * * ." '
"Growing in frequency are those trips of economics and sociology classes to
case illustrations, such as breadlines and strikes, of this magnificent chaos called
capitalism . Recently students from Amherst and Mount Holyoke, under the
leadership of Prof . Colston Warn(, made the rounds of New York's choicest soup
kitchens, and visited Brookwood Labor College 18 and the officers of various
radical organizations ." (Hearings, pp . 749, 750 .)
See also the Blueprints for Action as quoted in the Hearings, p . 749 .
And this, from the same issue of Revolt :
"We must look ahead four years. Local elections are in a sense more impor-
tant than national elections . To measure the success of the L . I . D . is to measure
the growth of Socialism in the community you are in ." (Hearings, p. 751 .)
The title of Revolt was changed in 1933 to The Student Outlook, but
its nature was not altered one whit . In the first issue under the new
name appeared an article by Helen Fisher reporting on the 17th New
York conference of the LID :
The speeches and questions were those of participants in the building of a
power-winning organization, not spectators .
It was a conference of practical revolutionists . -
Both Reinhold Niebuhr and Franz Daniel ruled out the possibility of our ever
attaining a Socialist commonwealth by purely parliamentary action
18 A since dissolved Communist hot-bed!
Both felt that the change would come through the general strike or some weapon
similar to it .
In the discussion of the Day After the Revolution, Paul Blanshard stressed the
necessity of presenting at least a sketch of the proposed society to those we are trying to
get to fight for it . Sociolopia, according to Mr . Blanshard, would have an inter-
national government, some international battleships and airplanes, complete control
of munitions, an international language and socialized ownership of industry
with control by workers, technicians, and consumers . Lewis Mumford then spoke
about the need for disciplining ourselves morally and intellectually the day before the
revolution . (Hearings, pp . 751, 752 .)
One Alvin Coons reported, in turn, on the Chicago LID conference :
CLARENCE SENIOR, national secretary of the Socialist Party, expressed the
belief that reforms would only further encumber the capitalistic system and that
every concession would only hasten its end .
Affirming his faith in democracy as an instrument of social change, he advocated its
use as long as possible, not however, excluding the use of other methods should it fail .
"Radical students," he declared, "can spend their time more profitably getting
acquainted with the problems of the workers, than they can in studying chemistry to
learn how to make bombs, or in going into the ROTC to learn how to shoot . You can
hardly expect to teach the workers to shoot straight for bread if you cannot teach them
to vote for it" . (Hearings, p . 755 .)
Is this ancient history? Has the socialist leopard changed his
spots? Indeed, no . Mr . Earl quoted at length from Freedom and
the Welfare State, the report of a symposium held by the LID on
April 15, 1950 . (Hearings, pp . 756, et seq ., and 762, et seq.) These
show that even today the League "is expending more energy in
political action than in education ." (Hearings, p . 756 .) To repeat
all these would burden this report . Suffice it to say (which a reading
of the record will readily show) the symposium was essentially political
in character, and was attended by many eminent political characters .
On April 11, 1953, the 48th LID Annual Luncheon was held in
New York . Speakers included persons of political significance and
eminence . At this point Mr . Earl was questioned regarding the
alleged "leftist" nature of these personalities . Mr . Earl stated that
he did not characterize these persons or their political beliefs as bad ;
he introduced their identities to demonstrate "the political nature of
the LID, and the fact that it is constantly in the political arena .
"I am not here to fudge the merits or the demerits of the program that the
LID has espoused, except to say that the LID has espoused socialism,
and that they are for certain things, and that being for a certain political
program, for certain legislation, I think they should be plumping for it
with dollars that remain after their income has been taxed ." (Hearings,
p . 763 .)
The political nature of this Luncheon Conference is indicated by
its prepared announcement :
At a time when the country is using up many of its natural resources at an
unprecedented rate; * * * when powerful lobbies are seeking to take our off-
shore oil resources out of the control of the Federal Government, to return the
TVA to private monopoly and to prevent the further public development of the
Nation's vast hydroelectric resources, and when adequate aid in the development
of resources of other lands is vital to the maintenance of world democracy, ,it
is most fitting that the LID should give its attention this year to this important
problem of conservation . (Hearings, p . 765.)
DR . HARRY LAIDLER, executive director of the LID made the
political nature doubly clear. This description was given in a LID
publication of Dr . Laidler's program for "democracy in action in
1953" :
In presenting this program Dr. Laidler declared that advocates of a
strengthened democracy 19 would be confronted in 1953 with powerful opponents,
well supplied with funds, and that, for the first time in 20 years, the main body
of the Nation's press would be alined on the side of the party in control of our
national government * * * .
The description of the "program" continues . Is it educational or
political?
1 . Conservation of natural resources : It urged the increase of forestland public
ownership and control ; the retention of offshore oil by the Federal Government
and the use of revenues from oil resources for educational purposes ; extension of
the TVA principle to other river basin developments
2 . Social security : The program recommended that the Nation consider the
enactment of a democratically operated national health insurance system * * *
and the strengthening of the old-age pension and unemployment insurance
system * *
3 . Labor legislation : * * * (reorganize child labor laws)
4 . Economic stability : It favored the formulation of plans for the mainte-
nance of economic stability when defense tapers off, by means of credit controls,
progressive taxation, useful public works, social-security programs, and other
measures.
5 . Housing : It proposed * * * Federal aid for the construction annually by
municipal housing authorities of a minimum of 135,000 apartments for low income
and middle income groups-
6 . Education : * * * (Federal aid, better salaries for teachers, "freedom of
inquiry," etc .)
7. Civil rights and antidiscrimination legislation : (stressed need for Federal
and State FEPC laws, liberalization of our immigration laws, fair hearing to all
public employees charged with un-American activities .)
8. Corruption : (Favored purge of dishonest officials .)
9. Foreign policy : The program favored, in addition to military aid, increased
economic, social, and educational assistance to developed and underdeveloped
countries
10 . Labor and cooperative movements : It urged * * * labor unity, the
strengthening of collective bargaining * * * in white collar trades . * * * It like-
wise urged the strengthening of the consumers' and producers' cooperative move-
ment * * *
* * * the league repoit viewed as antidemocratic trends the increased influence
of such public figures as Senator McCarthy on important Senate committees ;
* * * the increased confusion among Americans regarding what should con-
stitute a realistic democratic foreign policy ; the bitter propaganda against the
United Nations which had been witnessed on all sides during the year and the
continut d threats of men like Governor Byrnes to destroy their State's public
school system rather than abolish sa-gregation in the public schools . (Hearings,
pp. 765, 766 .)
As Mr . Earl pointed out, the relative merit of these proposals is of
no moment . The fact is undeniable that they are political in nature
and that the LID was engaging in active politics .
He gave another example from the report on a 1952 symposium
luncheon, in which August Claessen, National Chairman of the
Social Democratic Federation, referred to capitalism "now so inoffen-
sively called `private enterprise' " as being "essentially immoral . It is a
source of corruption in business and politics . Private enterprise corrupts
government enterprise and the only effective steps toward the elimination
of these immoral influences are the rapid extension of collectivism and the
advance of the cooperative movement ." (Heari ngs, p . 766 .)
We pause here to wonder whether the American people wish to
grant tax exemptions to donors to this organization whose dedicated
purpose is to supplant our form of government with another . We are
referring to only a few of the quotations and incidents which cannot
19 Note the characterization of the Republican party as the foe of' strengthened democracy" (small "d")!

162 TAX-EXEMPT FOVNtATIONS
leave any doubt that the LID uses its tax-freed money to promote
socialism in the United States .
Many of the quotations in the record of Mr . Earl's testimony are
from pamphlets sold by the LID and widely distributed . One of
these pamphlets, authored by MR . LAIDLER, the Executive Director,
and entitled Toward Nationalization of Industry, is a plea for socializa-
tion. He says :
"Under a system where the basic industries of the country are privately owned
and run primarily for profit, therefore, much of the income of its wealthiest cit-
izens bears little or no relation to their industry, ability, or productivity .
"The development of our system of private industry, furthermore, has been
accompanied by attempts at autocratic controls of economic, political, and social
relationships by owners and managers of our giant industries .
"Many of our great leaders of industry who have constantly and bitterly opposed
the extension of Federal power and nationalization on the ground of "regimenta-
tion," for years spent much of their time in an attempt to regiment their own
labor forces and, through the use of the spy system, armed guard, police, con-
stabulary, militia, injunctiqn, and blacklists, to prevent the workers under them
from exercising their American right to organize and to bargain collectively .
Laws passed during the thirties have made illegal many of these practices, but
ruthless and undemocratic procedures in labor relations are still resorted to in
industry after industry by the possessors of economic power . These same leaders
have sought to control and regiment political organizations, the press, the platform,
the pulpit, the school, and university in the city, the State, and the Nation .
"The industrialists of the Nation have frequently kept prices high and rigid,
have kept wages down, have constantly chiseled on quality, and have run their
businesses not for the service of the many but for the profit of the few . In many
instances they have sought to involve the contry in international conflict with
a view of safeguarding their investments abroad ."
• * * * * * *
"Our forests should be brought far more completely than at present under
Federal administration * * * ."
• * * * * *
"The forests of the country, under private ownership, are, furthermore, cut
down faster than they are restored . * * * Public ownership and operation, on
the other hand, would guarantee scientific forest management ."
• * * * * * *
"Bituminous coal mines should be brought under the control of the Federal
Government . * * * The condition of the industry under private control has long
been chaotic ."
• * * * * * *
"Anthracite coal is another resource which, in the interest of the Nation, should
be owned and controlled by the Federal Government ."
• * * * * * *
"The waste in the exploitation of our oil resources likewise necessitates further
Federal control ."
• * * * * * *
"The Federal Government should likewise increase its control over the Nation's
power resources * * * Dr . Isador Lubin 20 some years ago suggested the creation
of a Federal Power Corporation, which should have ownership not only of water-
power, but of coal, oil, and natural gas, with the view of coordinating the efforts
on a national scale of all of those industries which generate power ."
• * * * * * *
"The case for the nationalization of the railroads is a powerful one . Such owner-
ship, in the first place, would make possible the scientific planning of the trans-
portation industry for the entire country ."
• * * * * * *
"Only under Government ownership can a sensible plan be worked out . Only
under such ownership can a foundation be laid for cooperation between the rail-
road system and busses, water transportation, airlines, trucks, and other forms
of transportation, a cooperation absolutely essential to the health and welfare of
the Nation's transportation system ."
20 Dr . Lubin, Commissioner of the Bureau of Labor Statistics from 1933 until 1946 . was the United States
representative to the U . N. Economic and Social Council from 1946 until March of 1953 .
We agree with Mr. Earl that "If this means anything at all, it
means rigid government control over all forms of transportation, not
just railroads . Note also the wholly unreal assumption of bureau-
cratic infallibility which underlies the case for continental coordination
of transportation ."
"Only under Government ownership will it be possible to secure enough cheap
capital adequately to modernize the railroad system .
"Finally, Government ownership would serve the interests of democracy by
taking this vitally necessary industry out of the grip of a mass of holding com-
panies and financial interests intent on profits and placing it in the hands of
representatives of the 150 million people in the United States . Surely an industry
on which the health of the whole continent system is so dependent should not be
the plaything of small groups of railroad magnates and financiers . * * " (Hear-
ings, pp . 768, 769.)
Can there be any doubt of the political nature of these statements?
MR. LAIDLER goes on arguing for public ownership of power, com-
munications, manufacturing, banking and credit (Hearings, p .
770), and includes an advocacy of government planning of a degree
which can only be called socialistic . (Hearings, p . 771 .)
Mr. Earl included in his statement various passages from utterances
of - prominent LID members concerning Communism . Actually,
while they indicate a distaste for Russian Communism as a violent
force they welcome the social and economic ideas behind that Com-
munism . (Hearings, pp . 771, et seq .) Alfred Baker Lewis, Chairman
of the LID Board in 1943 suggested that the world revolution
promoted by Russia was "largely a defense measure" ; that the Russian
seizure of part of Poland was merely to achieve a band of defense
against Naziism ; and that subversion is merely the Russian way of
combating the aggressive war plans of the American capitalists . Note
the implication in the second sentence of the following quotation that
the Communist dictatorship itself is not aggressive :
"The Soviet's original attacks on the governments of the democratic nations
through the Communist Parties which it set up and controlled, were defensive
measures against attacks actual or expected from those capitalist nations . Rus-
sian imperialism today is the result of an act of will on the part of the Russian
dictator, Stalin, and not because it is the nature of a Communist dictatorship to
practice aggression upon its neighbors ." (Hearings, p . 772 .)
This was a Chairman of the LID speaking .
Norman Thomas, another LID Board chairman, in the pamphlet
entitled Freedom and the Welfare State, published in 1950, includes
this treasure, after asserting we must save the world through a
"cooperative commonwealth" :
"That cannot be done simply by the ballot in a world gone mad . Indeed, under
no circumstances can the working class put its trust simply in the political democracy
of which the ballot is the symbol ." (Hearings, p . 773 .)
Mr. Earl quoted at length from a pamphlet Freedom From Want,
which recorded the proceedings of the LID conference of May 8,
1943, in which political discussions were paramount . (Hearings, p .
774, et seq .) Alfred Baker Lewis added his touch with this state-
ment :
"To get freedom from want in the postwar world we must be clear that we cannot
do so by reestablishing complete freedom of enterprise, the fifth freedom which ex-
President Hoover and the National Association of Manufacturers want to add
to the four freedoms ." (Hearings, p . 778 .)

George Baldanzi, Executive Vice-President of the Textile Workers

Union of America contributed this treasure :
"Business and industry are looking for a solution to the problem of full employ-
ment within the framework of what they call free enterprise. What they mean,
of course, is their old freedoms to exploit . But free enterprise is drawing its last
gasp. This very war we are fighting, and the causes of the war, are indications
of the breakdown of the economy of free enterprise ."
* * * * * *
"Labor believes that special privilege will have to accept a planned economy, that
the days of laissez-faire are gone with the winds of war . We believe that production
will have to be geared to social need rather than to private profit ."
• * * * * * *
"History has shown us that full employment is ngt possible under a system of free
enterprise . * * * The free enterprisers are interested in profits, not people ."
• * * * * * *
"Whether it is established on the basis of democracy or on the basis of monarchy
or on the basis of fascism, the system of free enterprise inevitably leads to war .
When they dry up at home, entrenched privilege must look for them abroad .
War inevitably follows, and another war will follow this war unless the leaders
of the United Nations begin to think in terms of changing the economic pattern
as well as the political pattern of liberated and conquered nations ." (Hearings,
pp . 778, 779 .)
Among the other speakers was Nathaniel Minkoff of David Dubin-
sky's International Garment Workers' Union (ILGWU) . Mr.
Minkoff is this years president of the LID . He contributed this call
for political action through a new party :
• * * * * * *
"So much for the present . The real test will come 1'mmediately after the war,
when, what with sudden deflation, demobilization and shrinkage of production,
as well as with the inevitable worldwide confusion, our Nation will face the
grave danger of economic collapse . Only a courageous, farsighted economic
policy, based on long-range social planning, can save us from disaster . It is not
my purpose now to discuss what this postwar planning should consist of nor
how it should be undertaken . 1 merely want to stress that it is not merely an
economic and social question, least of all a mere question of technical expertness .
It is primarily a political question, for even the best program in the world must
remain a mere scrap of paper unless it is implemented with political power ."
"We must organize independently of old, now meaningless party a ffiliations into
a compact and mobile force able to exert its influence where and how it will do the most
good * * ."
• * * * * * *
"Above all we must be clear as to our social basis . What we want, I think, is a
democratic coalition of all functional groups in the community with organized
labor as its backbone and basis . I am not holding out to you any perfect models
but, with all its faults, I think the American Labor Party of New York State is
something of the sort we have in mind ." (Hearings, p . 779.)
This was hardly "educational" propaganda!
Samuel Wolchok, President of the Retail, Wholesale and Depart-
ment Store Employees of America, CIO, seconded this call in a speech
before the Washington Chapter of LID :
There is the sharp line of cleavage as to the future of the postwar world, between
the idealistic forces of the liberals on the one hand, and the blind, cruel forces of
the reactionaries on the other .
• * * * * * *
The reactionaries are well organized . They have power, the press, the radio,
money and ruthlessness on their side . They are well-girded for battle . They
are far more interested in controlling the peace than in winning the war and
their energies are solely directed to that end .
* * * * * * *
The solution then lies in a third party * * * a party supported by trade unions
and true farmers' unions by welfare organizations, by civic bodies, and by other
social-minded groups and committees * * * . (Hearings, pp . 779, 780 .)

TAX-EXEMPT FOUNDATION$ 105
Other.-speakers followed the same general line .. Interesting- also

was the' round table discussion of Mobilizinq our Forces, Economic,
Political, Cultural, In Behalf of the New Freedom . (Hearings, p . 779E
et seq.)
In another LID pamphlet entitled Toward a Farmer-Labor Party,
HARRY W . LAIDLER issued in 1938, expressed impatience with the
Democratic Party and agitated for the formation of a new party on
"liberal" lines . (Hearings, p . 781 .)
Is this pamphlet educational or political?
Far more "excerpts from LID publications could be given to show
the essential political character of the organization and that its efforts
were directed to influence legislation . See, for example, the discussion
of the LID annual conference in New York in April 1951, at Hearings,
pp . 781, 782, et seq . The final session of this conference was given
over to "consideration of labor political action ." Mr . Robert Bendiner,
for example, urged :
"Labor should aim at political action that would not be confined to a narrow
program of wages and hours, but would be directed to the achievement of public
welfare in the broadest sense . Labor should show more and more independence
than has been hitherto the case ." (Hearings, p . 784.)
There had earlier been a discussion on the subject, How Free is Free
Enterprise . (Hearings, pp . 768, et seq.)
With these words of Mr . Earl at the end of his presentation, this
Committee heartily agrees :
In conclusion, Mr. Chairman and members of this committee, let me, say that
in this presentation I do not quarrel with the right of these many peole in the
LID, and all of those who have been recipients of its awards or have spoken to it,
and I don't quarrel with their people,- to say and write the things which we have
discussed, though I disagree with many of the thins which they advocate .
My thesis is this : If the LID is to continue to fill the air with propaganda concerning
socialism ; if it is to continue stumping for certain legislative programs ; and if it is to
continue to malign the free enterprise system under which we operate-then I believe
that it should be made to do so with taxed dollars, just as the Democrats and the
Republicans are made to campaign with taxed dollars . (Hearings, p . 785.)
We urge the Bureau of Internal Revenue to read Mr . Earl's entire
prepared statement and all of the long list of LID pamphlets . which
he submitted in evidence and left with the Committee .
DR . LAIDLER, as Executive Director of the League for Industrial
Democracy filed a statement with this Committee which is in the
record . It is an attempt (1) to show that this socialist o rganization . is
no longer socialist and (2) that it is essentially an educational organi-
zation . As to the first contention, that it is no longer "socialist", we
might grant that it is now "collectivist" if that distinction is in any
way helpful . Few of its members, associates and officers may be
members of the Socialist Party, but the fact is that very few socialists
now belong to the Party . Norman Thomas, so long its leader, has
ceased to hope that the Party would continue to be an effective vehicle
for the promotion of socialism . The socialist movement is now in
substance outside the Party .
As to the second contention, that the organization is essentially
an educational institution, it is difficult to reconcile this claim with
the literature it has produced, the nature of its meetins and con-
ferences and the identity of the persons associated with it . We
might grant ' the organization an educational character of a kind-that
it is an organization to educate the public into the advantages of over-
55647-54--8
throwing our society and substituting a collectivism for it . if that is

pro~erly educational, to entitle it to receive donations with tax exemption
to the donors, something is very wrong with the law .
ANOTHERs SPECIFIC INSTANCE OF CLEAR POLITICAL USE : THE
AMERICAN LABOR EDUCATION SERVICE .
The American Labor Education Service is a foundation presumably
engaged in the "education" of "labor ." Its activities seem, however,
to have trespassed the borders of political propaganda and political
action.
The background of -some ALES staff members, together with . a list
of participants in ALES conferences suggests an interlock with indi-
viduals and groups associated with militant socialism and, in some
instances, with Communist fronts .
ELEANOR C . ANDERSON (Mrs . Sherwood Anderson) is listed in the
1938 ALES report as its treasurer and as a director . Among its other
officers have been-
MAx LERNER, a former treasurer and director,
J . RAYMOND WALSH, a director and vice chairman up to at least 1948,
EDUARD C . LINDEMAN, a director until his death in 1953 .
All these have a record of Communist front affiliation which will
be found in the Appendix to this Report .
An analysis of some of the activities of ALES is included in the
record at page 727 et seq., and is worth careful reading . Various
conferences have been held by the organization . The Washington's
Birthday Workers' Education Conference sponsored annually by
ALES was originally started at BROOKWOOD LABOR COLLEGE in 1924
under the auspices of a local of the AMERICAN FEDERATION OF TEACH-
ERS . This association did not bode too well, for BROOKWOOD COLLEGE
was denounced by the American Federation of Labor in 1928 as an
"incubator of Communists ."
At various ALES conferences, political subjects received prominent
attention. Nor were they studied merely from an educational angle .
An October 2, 1946 invitation to attend a conference at Milwaukee
stated
'The topic for this year's discussion is a timely one `How can Workers' Educa-
tion Advance Labor's Economic and Political Objectives' .
"At the dinner, we shall consider methods labor must use when collective bar-
gaining does not work, especially methods of dealing with the government ." [Em-
phasis ours .]
Among the subjects of the 1947 ALES Mid-West Workers' Educa-
tion Conference, were "Political Action for Labor" ; and a work-shop
project-"Political Action Techniques ." The Conference at the New
School for Social Research in February, 1950, discussed: "The
Contribution of Labor in Rebuilding Democratic Society" and "The
Role, of Workers' Education in Political Action ." Similar to a Mid-
West Conference in November, 1948, the 1950 Conference strongly
stressed "the urgency of participation in political action by labor,
and, the re-evaluation of education in relation to political action ."
Nor was political action to be confined to the domestic field at ALES
conferences. "International affairs" for labor received much atten-
tion, as did foreign policy and the desirability of labor participating
in, establishing foreign policy . ALES even operates a Philadelphia
Center for leadership training in world affairs,

TAX-EXEMPT F'otINDATId1cS 107
"Joint farmer-labor action" receives frequent attention . . "Action"

as used, presumably means action, the building up of political pressure'.
In other words, labor is not being merely educated in facts ; issues and
principles, but is being urged to take action, sometimes in association
with other groups and sometimes by itself, for political goals . Is
that "education" of the type entitling the ALES to tax exemption?
If it is, there is something wrong with the law which permits tax-
exempt money to be used for propaganda to induce political pressure .
The 1953 Report of ALES says that it has, in recent :years ;,, gi /en
special attention to "areas of work where the labor movement'belie(ves
that, through education, responsible action . might be strengthened .,
Action, action, action-education for action-is the keynote' of the
ALES program . This includes inducing "white collar workers" to
join the labor movement (1953 Report, p. 11) . .It :also includes
giving attention to
"the legislative and political scene in Washington ; with special emphasis on legislative
and community action carried on by organized labor ."
Among the materials used by the ALES for its "educational.'
service, are a series of pamphlets "for Workers' Classes . These
include Toward a Farmer-Labor Party by HARRY W . LAIDLER (whom
we have met as executive director of The League for Industrial`' DO-
mocracy, which published this pamphlet) as well as other publications
of the LID . One pamphlet is of a nature which would bring' on a
smile, were the orientation not so serious . It is called "Fordism" ;
it should bring pleasure to the hearts of those in the Ford Foundation
who were responsible for contributing very substantial sums of public
money to ALES through its Fund for Adult Education
These pamphlets were listed in an Annotated &t, ' a 45 page
brochure, in 1938 and sold by ALES . The brochure also includes'
list, with a synopsis of each, of plays which are recommended by ro'=
duction by labor groups in order to improve the "education of la r.
Many of these deserve special attention . They are calls to action,
indeed! Two of them were sponsored by the HIGHLANDER FOLK
SCHOOL of Monteagle, Tenn ., directed by Myles Horton and James . A
Dombrowski, officers of and two of the leading lights in THE SOUTHERN
CONFERENCE FOR HUMAN WELFARE-an, organization officially cited
as a Communist front . The HIGHLANDER FOLK SCHOOL received large
sums of money from the Robert Marshall Foundation : Many were
recommended by the BROOxwoon LABOR COLLEGE, upon which we
have already commented. Sponsored by the Southern Summer
School, was Bank Run and Job-Hunting, and On The Picket Line,
none of which were intended to improve the relationship of labor with
the capitalistic system .
A treasure is Black Pit by ALBERT MALTZ (who was cited by the
House of Representatives on October 24, 1947, for contempt of Con-
gress and subsequently served a jail term) which ALES' describes . as
follows :
"A miner, framed because of union activity, after coming out of jail, attempts
to find work but is blacklisted everywhere because of union record . Is driven to
accept position as stool pigeon . Requires convincing use of Slavic dialect : and
intelligent direction ."
Another MALTZ masterpiece is Rehearsal, recommended highly by
ALES ; it has to do with the Detroit auto strike . And there are
many more treasures in the recommended list of plays . There is

The Maker of Swords which, laid in an imaginary country, shows
what mischief munitions makers can do . And Blocks (sponsored by
the Vassar Experimental Theatre) is described as :
"A powerful satire in which Green Worker and Tan Worker symbolize all the
masses forced unwillingly to war, while the Green Man and the Tan Man symbol-
ize all the leaders, generals, and capitalists making war without engaging in it ."
[Emphasis ours,)
Two plays from Soviet Russia are included in the list, which seem
to be adulatory of the efforts of the Communists to improve the lot
of the Russian peasant.
In 1942 ALES published Songs Useful for Workers' Groups . This
includes "SocialiMt and Labor Songs", some of them revolutionary
works translated from foreign languages, including the Russian . Some
are set to "stirring original music" by HANS EISLER, that notable
Communist . There is also a Rebel Song Book on the list .
The reader is referred to the material in the record (page 727,
et seq.) for further examples of the incitement to action and the indica-
tions that "education as recommended by ALES consists largely of
creating class hatred and animosity against the free enterprise system,
One person associated with ALES deserves some special attention .
He is MARK STARR, its Vice-Chairman . M R . STARR has also been
Chairman of the LID . His interlockings are rather extensive . He
is Directorr of Education of the ILGWU, and a member of the United
States Advisory 'Commission on Educational Exchange . He has
been appointed to responsible policy position in the field of education ;
as labor consultant to Elmer Davis' Office of War Information (OWI) ;
as a member of the American delegation to establish UNESCO ; as a
labor education consultant to the American military government in
Japan ; and as a member of President Truman's Commission on
Higher Education . He has also been chairman of the Public Affairs
Committee . Let us, then, examine into MR . STARR's philosophy of
education to see whether an organization with which he is intimately
connected in policy making deserves foundation support .
MR STARR'S Labor Looks at Education, published by the LID
in 1947, not only m akes . no distinction between education and propa-
ganda, but affirmatively approves of the latter. There must be pur-
pose in education, he indicates, and his own purpose is made quite
clear :
"A new philosophy of education is striving to be born-a planned community
to replace the jerry-built dwellings produced by the haphazard efforts of the
past.
He expresses sympathy with the efforts of Marx and Veblen to "blast
away the intellectual girders supporting the modern economic system ."
MR . STARR has been a heavy beneficiary of largess from the
Ford Foundation's Fund for Adult Education . But he has his own
opinions about foundations . He says that "colleges too often have to
go cap-in-hand and exploit personal contacts with the uncrowned kings
and agents of philanthropy * * * There are, of course some foundations
which delouse effectively the millions accumulated by monopolies and
dynastic fortunes ; but if one could choose a way for the long time support
of education, it would be done by community intelligence rather than the
caprice of the big shots of big business who wash to perpetuate their names
TAX-9K MI1' FOUNDATIONS 1Q9
in a spectacular fashion, a process which may not in all cases coincide

with the real educational activity of the college ."
Education must be used to cure the social ills . Workers' education,
in particular, is necessary to "the end of group action ." His .general
thesis is that labor unions and their leaders have a monopoly on ~
patriotism, while Congress, business and everybody else . are selfish.

Political science and civics courses should so indoctrinate students .
(For an example, see pp . 41-42, of "Labor Looks at Education ."),
Another ALES director is HILDA SMITH, who has been noted
for her questionable connections both by the Dies, Committee and the
House Un-American Activities Committee .
The controversial Director of Workers' Education of the Works
Progress Administration, who was a member of the American League
for Peace and Democracy, another organization officially cited to be
a Communist front .
Adult education for the so-called "working man" is a truly worthy
objective, and its conduct through unions is highly desirable . But
this is no mere "education" which is being given by the American
Labor Education Service . It is incitement to political action 444
breeding of class hatred . As such, it is neither a proper function for a
foundation which enjoys tax-exemption nor does it entitle other-foun-
dations to give it support .
THE TWENTIETH CENTURY FUND
This foundation gives a good example of carelessness in selecting
foundation manpower by ignoring radical political bias . This Com-
mittee assumes it was carelessness . If the persons discussed below
were integrated with the Fund's work with a full understandin of
g
their identities, and an intention to use them because they had

exhibited strong, radical political bias, our criticism would be °' far
sharper.
The Twentieth Century Fund was founded in 1919 by the late
Edward H . Filene of Boston . . Its purpose is "the improvement of
economic, industrial, civic and educational conditions," but the 195'1
report of the Fund indicates that it has confined itself to economic
fields. Apparently, since 1937, the Fund has made no grants to others
but has acted as an operating unit within itself .
The Fund (says its 1951 report) purposely selects subjects for re-
search and study which are "controversial * * * since controversy
is an index of importance and since the Fund's impartial professional
approach is clearly of most value to the public just where controversy' is
sharpest ."
This Committee has not been able to study the work of the Fund
in detail and can offer no opinion as to the extent that the Fund has,
in fact, been impartial . It is impressed, however, with the fact that
some of the key men associated with the Fund have records which
would not indicate that they would be likely to give impartial treat-
ment to any subject having political implications . It is, of course,
theoretically possible for even a Communist to do an impartial eco-
nomic study ; but it is our opinion that a fo undation which selects
persons of known radical political opinion risks the misuse of the public
money which the foundation's funds represent .
For many years EVANS CLARK was Executive Director of the
Fund and as such wielded considerable mfiuence . While he no .longer
+PAX-EXEMPT FOUNDATIONS
holds` that position, he is still a trustee of the Fund . Prior to 1920

MR . CLARK was director of the Department of Information, Bureau
ofthe Representative in the United States of the Russian Socialist Federal
Soviet' Republic . In 1920, the RAND SCHOOL, well-recognized as a
radical institution, published MR . CLARK's book, Facts and Fabri-
cations about Soviet Russia . It is an ardent defense of things Russian
and Communist and riducules the criticism levelled at them. MR.
CLARK has been cited a number of times both by the Dies Committee
and theHouse Committee on Un-American Activities .
It might be that he has since modified his opinions, and perhaps he
has ., Perhaps he no longer supports Soviet Russia . But we note
that he is , the husband of FRIEDA KIRCHWEY, well-known as an
extreme radical, whose citations by the Dies Committee and the
Un-American Activities Committee are almost monumental . We do
not mean to imply "guilt by association," but recite the facts to
indicate that the general atmosphere surrounding MR . CLARK would
no b. have recommended him for selection as the Executive Director of
an "impartial foundation active in the politically-charged field of
economics.
The Editor of the Fund's publications is one, GEORGE SOULE .
Mr. Soule was cited by the Dies Committees, and his record is among
those in the Appendix to this Report . Should a man with the radical
opinions proved by his record be "editor of publications" in a founda-
.tioa dedicated to the public welfare?
Among the other trustees of the Fund are : BRUCE BLivEN, ROBERT
S . LYND, and PAUL H . DOUGLAS all of whom have been cited by
'congressional committees and their records appear in the Appendix
to this Report.
The Twentieth Century Fund has published many of the works of
STUART CHASE, whose political bias is discussed in section VIII of
this report .
That one officer or one trustee of a foundation may have been
cited 10, 1 .5, 20, or more times by a Congressional Committee investi-
gating subversive activities, for his associations and his affiliations
with :Communist Fronts, may not thereby establish the legal proof
required in a court of law that he is a card carrying member of the
Communist Party itself ; but it would seem to this Committee that
such .a record would be conclusive evidence that such person was an
extreme radical or a ,complete dupe and has no business serving in a
position of trust .
Such an individual would most certainly be tagged as a security
risk by any agency of the Government under past or present loyalty
standards and dismissed . Tax Exempt Foundations should be no
less . exact in, their standards of loyalty to the United States and our
American institutions .
Thath several 'such persons should be actively and importantly associated
with a public trust, TAX EXEMPT FOUNDATIONS spending
millions of dollars in public money is, in our considered opinion, highly
improper. and exhibits an utter lack of responsibility by foundation
;trustees and directors in the discharge of their duties .
THE FUND FOR THE REPUBLIC
An .: example of the danger that a great foundation may use its
publie'trust funds forr political purposes or with political effect is to
TAX-EXEMPT FOUNDATIONS M
be found in the creation of The Fund for the Republic as an offshoot
of The Ford Foundation .
Mr. Paul Hoffman, Chairman of the Fund, filed a statement with
the Committee (included in the record) on behalf of . the Fund
"because", he stated, "Representative Reece's speech of July ; 27,
1953, now a part of the record of the 'investigation', 21 contains refer-
ences to the Fund, and to me .personally which, in .the interests of
accuracy and fairness, require comment." Mr. Hoffman denies that
there is any basis "whatsoever for the charge that The Fund for the
Republic was established to attack Congress ." He asks "that the
Committee will refer" to "documents and data requested by the
Special Committee" which have been supplied, "rather than to the
Reece speech for the facts ." We shall, in deference to Hoffr
man's request, refrain from quoting Mr . Reece and shall use, in this
discussion, principally material supplied by The Ford Foundation and
The Fund for the Republic themselves .
The aggregate donation of The Ford Foundation to its offspring,
created for the purpose, was $15,000,000 . This is a rather large sum
of money, even for the gigantic Ford Foundation . After all, that
foundation's principal assets are in stock of the Ford Company . Its
cash resources are pretty much limited to its income of something
over $31,000,000 per year. Thus about half a year's gross income of
earnings of the Ford Motor Company was allotted to The Fund for
the Republic . While The, Fund for the Republic is presumably under
independent management, its Chairman is Mr . Paul Hoffman, who
was formerly Chairman of The Ford Foundation and who was ap-
pointed to head the Fund upon his resignation from The Ford
Foundation.
The first President of The Fund was Clifford P . Case, who apparently
resigned from Congress to take the job . Mr. Case had made ., clear
while in Congress that he was a severe critic of some Congressional
investigations . Recently, Mr. Case resigned from his post with the
Fund to run for the Senate from New Jersey . His first major speech
in his campaign made clear that he is a violent "anti-McCarthgite" .
We do not object to his taking a strong position in this area ; we point
out, however, that his public utterances have hardly characterized
him as objective in his approach .
Mr . Case's successor is Dr . Robert Maynard Hutchins, who resigned
from a directive post in The Ford Foundation to take this new position.
Dr. Hutchins' ideas on Congressional investigations are too-well known
to need any elaboration, as, indeed, are those of Mr . Hoffman . . As
The Fund for the Republic has as one of its purposes an investigation of
Congressional investigations, it does not seem to this Committee .. that
the trio of Hoffman, Case and Hutchins was well selected in, the
interests of objectivity .
Only a small part of the capital of the Fund has been spent to date.
One of its grants was to the American Bar Association for studies relat-
ing to "civil rights" and Congressional investigations . The implica-
tion is given by the statement filed on behalf of the 'Fund for the
Republic by Mr . Hoffman that this is the sum total of its expected
activities in the Congressional investigation area. We are inclined
to wonder, however, whether the presence of this current . investiga-
21 Putting "investigation" in quotes was an intended insult to this Committee . Mr. uoffnian's •state .
ment is, of course, directly insulting to the Chairman of the Committee .
tion by a Congressional Committee has not acted as a deterrent and

kept the Fund (perhaps only for the moment) from launching an inde-
pendent "study of its own . We italicize the word "study" ; the evi-
dencerpersuades us that it would not be a mere study but an attack
on Congressional committee methods .
At the time The Fund for the Republic was publicly announced
stories began to circulate to the effect that ithad been created to
"investigate Congressional investigations ." This rumor has been
denied by The Ford Foundation and by The Fund for the Republic .
Yet the conclusion is difficult to avoid that such was, indeed, one of its
purposes .
The Fund for the Republic was allegedly formed in furtherance of a
program of the parent organization as follows :
"The Foundation will support activities directed toward the elimination of
restrictions on freedom of thought, inquiry, and expression in the United States,
and the development of policies and procedures best adapted to protect . these
rights in the face of persistent international tension . . .
"The maintenance of democratic control over concentrations of public and
private power, while at the same time preserving freedom for scientific and tech-
nological endeavor, economic initiative, and cultural development .
"The strengthening of the political processes through which public officers are
chosen and policies determined, and the improvement of the organizations and
administrative procedures by which governmental affairs are conducted .
"The strengthening of the organization and procedures involved in the adjudi-
cation of private rights and the interpretation and enforcement of law .
,"Basic' to human welfare is general aceeptance,of the dignity of man, This
rests on the conviction that man is endowed with certain unalienable rights and
must be regarded as an end in himself, not as a cog in the mechanics of society
or a mere means to some social end . At its heart, this is a belief in the inherent
worth of the individual and the intrinsic value of human life . Implicit in this
concept is the conviction that society must accord all men equal rights and equal
opportunity. Human welfare requires tolerance and respect for individual,
social, religious, and cultural differences, and for the varying needs and aspira-
tions to which these differences give rise . It requires freedom of speech, freedom
!of the press, freedom of worship, and freedom of association . Within wide
limits, every person has a right to go his own way and to be free from interference
or harassment because of nonconformity ."
That the words "The Foundation will support activities directed
toward" carries the significance of supporting political action or
political movements, might fairly be concluded . The contrary. has
certainly not been made clear in the quoted statement . But the
paragraph from which this phrase is taken proceeds : "the elimination
of restrictions on freedom of thought, inquiry, and expression in the
United States * * * " What "restrictions" exist in the United
States on "freedom of thought"-in fact, what restrictions could con-
ceivably ever be placed anywhere on the freedom to think-is a
question indeed! The use of the phrase, "freedom to think," one
tossed about emotionally by those who falsely call -themselves
"liberals," does not indicate the sober reflection which one would
expect of the managers of public trust funds, but rather an accept-
ance of the current "liberal "line" .
As to the other restrictions mentioned, it is not difficult to draw the
conclusion that Federal loyalty procedures and Congressional investi-
gating activities are intended to come within the compass of the Fund's
studies . Moreover, political-action significance may well be attached
to the rest of the section from which we have quoted .
The second paragraph of the quoted material seems to us either
"double-talk" or an advocacy of expanded government control of

Reece Committee Hearings - Tax-Exempt Foundations (1953) - Part 3 of 4

Hochgeladen von

Dokumentinformationen

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Reece Committee Hearings - Tax-Exempt Foundations (1953) - Part 3 of 4

Hochgeladen von

Copyright:

Verfügbare Formate

TAX-EXEMPT FOUNDATIONS 1077

strength and in moral and intellectual capacity on the basis of free

We respect the heavy responsibility which rests upon the Congress

very point of greatest interest to this committee, namely, the respon-

TAX-EXEMPT FOUNDATIONS 1079

We do not see how such responsibility could possibly be assigned to

TAX-EXEMPT FOUNDATIONS 1081

Report of legal GEB records

Columbia University $7,607,525 a $3, 804,644

' Transcript, p . 1568 . Ibid ., p . 701.

Regarding grants by the Rockefeller Foundation, 1929-52

Report of legal RF records

American Council on Education $1,235,600 $397,400

I Transcript, p . 1574. Ibid ., p . 703 .

American Council of Learned Societies (19Z15-52) ----------------------------- $11,069,770 $4,758,775

I Report, pt. 11, p. 51 . Ibid., p. 294 .

At the first public hearing, the chairman of this committee included

Little criticism has come to us concerning research or other foundation activities

TAX-EXEMPT FOUNDATIONS 1083

If, however, we classify as error any departure from a generally

A . ORGANIZATION AND PURPOSES

The Rockefeller Foundation was chartered by a special act of the

20' An additional $116,615 was received in gifts from other sources .

have now been distributed or allocated except for a relatively small

TAX-EXEMPT FOUNDATIONS 1085

2. Between meetings of the board, its executive committee, consist-

mittee, 25 the gist of which is quoted in Mr . Fosdick's history of the

It has been suggested to this committee that foundations have had

promising successes . It was wholly naturall to attempt to apply sim-

TAX-EXEMPT FOUNDATIONS 1093

Used their resources for purposes which can be classed as un-American?

simply indicates that said name has been mentioned in connection

in terms of a narrow formula couched in purely political terms . rn-

service, whether political or nonpolitical in character, under every

This investigation has heard a great deal of talk about "propa-

TAX-EXEMPT FOUNDATIONS 1101

We accept as an established fact that the United States is involved

tion have been loaned to international organizations for particular

TAX-EXEMPT FOUNDATIONS 1105

1106 TAX-EXEMPT FOUNDATIONS

seums, special research bureaus, and various organizations of scholars

sidered vitally important (and proved to be costly) is testified by

I . RELATION WITH THE UNITED STATES GOVERNMENT

That there are many relationships between education, particularly

(d) The foundation, with a long experience in what has come to

J . SCHOOL AND COLLEGE CURRICULA

It has also been charged that foundations have been responsible

1112 TAX-EXEMPT FOUNDATIONS

TAX-EXEMPT FOUNDATIONS a te . 1113

changes occurred in curricula and methods in the high schools and

1114 TAX-EXEMPT FOUNDATIONS

In considering these charges as they relate to the General Educa-

TAX-EXEMPT FOUNDATIONS 1115

school and college curricula in a particular direction . Furthermore

1118 TAX-EXEMPT FOUNDATIONS

in the educational field have been invaded or encroached upon? If

Reference has been made in the testimony to an "interlock" 67 among

TAX-EXEMPT FOUNDATIONS 1119

there is any instance of any manipulation of 2 foundations through

1120 TAX-EXEMPT FOUNDATIONS

TAX-EXEMPT FOUNDATIONS 1121

1122 TAX-EXEMPT FOUNDATIONS

STATE OF NEW Yom,

The Rockefeller Foundation General Education Board Combined totals